PROOF - ENRON'S POLICIES EXPAND SUPPLY AND FIX THE POWER CRISIS

Here are the arguments / material that I am trying to round up by mid-day
Friday. Please add anything else to this to prove our point.

Enron's Agenda - Making the System More Reliable / Ending the Crisis

1. Supply - really four key pieces to the puzzle (1) Streamline Generation
Interconnection, (2) Mandatory Electricity Reliability Organization, (3)
Public Power Transmission Facilities Fully Under FERC, (4) Complete Open
Access - End the Native Load Exception

The key theme: Open Access "expands" the available generation and reduces
the overall need to build.

2. Demand - Industrial & Commercial Demand Buydown

The key theme: Sometimes the cheapest watt is the watt that isn't used.

I want to add that I still think that the right message is reliability AND
cost savings. In California, the electricity bill could go from $7
billion/year (1999) to $70 billion/year (2001). No matter how big your
economy is, there is no way that a price shock of that magnitude won't kill
your future growth.

KEY PROOF

1. HEPG Presentation Shapiro

2. Natural Gas Analysis Carson

3. Balkanization Analysis Walton/Comnes/Neustaedter

4. AEP Transmission Abuses Novosel

5. FERC Staff Report Anecdotes Novosel

6. TCA Analysis - Price Impact Pickel/Tabors

7. TCA Analysis - Expanding Supply Pickel/Tabors

8. Western Power Market Abuses Dasovich/Comnes

I will try and call everyone in the am to discuss.

Jim