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Enron Mail |
I agree.
I think a specific thing we could ask for re QF's re your point 2 below is to require the CPUC to move the SRAC formula back to a hedgeable basis. Specifically, get them off of WACOG and back to a border index. That would allow the least expensive hedges. 5000 MW at SRAC if hedged by the IOUs would save them alot of money in the near term. Frank W Vickers 12/29/2000 11:38 AM To: Dave Parquet cc: Subject: Response Dave, I think that we need to insert some QF based thoughts into the discussion. See comments to Jeff below. Frank ---------------------- Forwarded by Frank W Vickers/HOU/ECT on 12/29/2000 11:04 AM --------------------------- Frank W Vickers 12/29/2000 10:46 AM To: Jeff Dasovich/NA/Enron@Enron cc: Terry Donovan Subject: Response Jeff, we need to add some discussion focused on QF issues in California and how resolution to certain items would enhance QF ownership and provide the utilities with optimal performance of the QF's and perhaps encourage new capacity development at existing QF locations. The utilities should be motivated to enter into buyout, buydown, blend and extend, negotiate fixed energy prices and other restructuring transactions with the QF's. The utilites have the ability to hedge the floating price currently being paid to the QF's. They should be motivated to look into these structures. Utilities should provide some clarification to the energy prices under QF PPA's. There is alot of risks around SRAC and PX that affect both the utilities and the QF owners. It seems like resolution to that risk is beneficial to both the utility as well as the QF. QF's should have the ability to move excess capacity and energy into either the market and/or to the utility. That would create additional economic incentives for the QF's to run and perhaps increase their capacity. Frank
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