Enron Mail

From:carol@iepa.com
To:william_carlson@wastemanagement.com, billw@calpine.com, bellery@spi-ind.com,rescalante@riobravo-gm.com, cabaker@duke-energy.com, cody.carter@williams.com, curt.hatton@gen.pge.com, curtis_l_kebler@reliantenergy.com, david.parquet@enron.com, dean_goss
Subject:IMPORTANT DOCUMENTS: QF PRICING/NON-PRICING TERM AGREEMENT AND
Cc:
Bcc:
Date:Fri, 19 Jan 2001 08:39:00 -0800 (PST)

Cc: steven@iepa.com, smutny@iepa.com, kaplan@iepa.com, dkk@eslawfirm.com,
abb@eslawfirm.com
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Attached are the latest versions of the PG&E QF Pricing/Non-Pricing Term
Agreement [1/19/01 DRAFT WASHINGTON DC SUMMIT ON CALIFORNIA ENERGY CRISES:
PG&E AND QF PARTIES BLUEPRINT FOR RESTRUCTURING OF ENERGY PRICING] and the
PG&E/QF Forbearance Agreement [DATED 1/19/01]. This documents are
essentially final form, but we recognize the potential need for future
discussions. The goal, however, is to have the QF parties circulate these
documents to their principals, lenders, etc. over the weekend for review.

Regarding the QF Pricing/Non-Pricing Term Agreement AS IT PERTAINS TO
NON-GAS FIRED QFS, we are seeking some type of letter, email, sent by a QF
Party, under cover of Confidentiality, NO LATER THAN 10;00 A.M. (PST) ON
MONDAY, JANUARY 22 which would indicate how many MWs and at what price the
QF industry would be willing to deliver to PG&E pursuant to the QF
Pricing/Non-Pricing Term Agreement. INCLUDED IN THIS ."PROPOSAL: LETTER OF
COMMITMENT" SHOULD BE CLEAR LANGUAGE AS TO WHETHER THE PRICING PROPOSAL IS
CONTINGENT ON THE SUCCESSFUL RESOLUTION OF THE NON-PRICING MATTERS, PERHASPS
SPECIFIYING WHICH ONES INCLUDING CREDIT ENHANCEMENTS. THIS IS IMPORTANT
FOR PG&E TO KNOW WHETHER WE HAVE CRITICAL MASS AND WHAT THE LIKELY AVERAGE
PRICE MIGHT BE FOR NON-GAS FIRED QFS. THIS WILL BE AN IMPORTANT INPUT INTO
THE CPUC "ALL PARTIES" QF MEETING SCHEDULED FOR MONDAY ON JANUARY 22 AT 1:00
TO ADDRESS SRAC MATTERS.

All proposals of "letters of commitment", which will be non-binding pending
signature on January 28, should be forwarded to PG&E as a Good Faith Offer.
These proposals should be sent via email to Keenen O'Brien, PG&E, at the
following email address: kjo5@pge.com

Regarding the Forbearance Agreement, all parties understand and agree the
importance of a credit enhancement to make this work. At present, the
concepts of the credit enhancement are undergoing PG&E senior management
review. For now, the concept is provided in the Forbearance Agreement as a
placeholder pending this review. As the documents contemplate signatures no
later than January 28, the lack of this language now hopefully will not
detract from companies' ability to make proposals of commitments under the
QF Pricing/Non-Pricing Terms of Agreement.

The next meeting with PG&E is scheduled for 10:00 a.m. on Monday, January
22, at PG&E.


<<dkknongas1.doc<< <<third forbearance agreement (no guaranty).doc<<

- dkknongas1.doc
- third forbearance agreement (no guaranty).doc