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Enron Mail |
The public power person who wrote the article Sean is discussing has always
been opposed to RTO West and was just seizing another opportunity to oppose it. The FERC staff is no less commited to RTOs, and I'm sure the IOUs are no less committed for that reason. In addition, I doubt FERC Commissioners in the new administration will back-track on RTO formation especially because of what has happened in California (how the state took too much control of ISO formation and control). From: James D Steffes@ENRON on 01/22/2001 07:51 AM CST To: Sean Crandall/PDX/ECT@ECT cc: Alan Comnes/PDX/ECT@ECT, Mary Hain/HOU/ECT@ECT, Steve Walton/HOU/ECT@ECT, Tim Belden/HOU/ECT@ECT, Paul Kaufman/PDX/ECT@ECT Subject: Re: RTO West Meeting of January 12 Sean, et al -- My understanding of what Enron wants from an RTO is (a) liquid energy markets (spot and forward) and (b) manageable transmission risk. Of course, there are a great deal of sub-issues that need to be implemented for these high-level objectives to be met. I don't disagree that simple solutions make sense for most RTOs given the current state of the market (specifically the backlash from California) and the politics at FERC about "enforcing" Order 2000 (remember the Order was voluntary). On the other hand, now may be an opportunity to lay the framework for really pushing hard on getting the rules right; policies of the past have been half-way or incomplete. Sometimes it takes a crisis for policymakers to do the right thing. Too this point, we are trying to engage the Western Governors and other political leaders outside California to continue to drive toward something that won't resemble California. Jim Sean Crandall@ECT 01/21/2001 01:57 PM To: Alan Comnes/PDX/ECT@ECT cc: Tim Belden/HOU/ECT@ECT, Steve Walton/HOU/ECT@ECT, Mary Hain/HOU/ECT@ECT, James D Steffes/NA/Enron@Enron Subject: Re: RTO West Meeting of January 12 Alan, Thanks for the update. I think the amount of time we allocate to the RTO West, and the extent we coordinate with other marketers, has to be reevaluated in light of what is going on in California. The California blow up is bound to raise some serious concerns in the Northwest (the e-mail from the PPC guy is probably the first of many), as well it should. I think a driving concern we should have, particularly now, is that the primary objective of the RRG is to lay the framework for a successful market place and to NOT try and solve all problems and get mired down in complexities and software limitations. I would argue the intial RTO framework has to be simple and adaptable. What is it exactly Enron wants? Do we want all control areas collapsed, a ancillary service market, a non-contract-path-based congestion management system? Why? How prudent is it to forge ahead while California is in such disarray? Is the goal to just comply with FERC, or to create something that will provide a basis for a sound market in (initially) a simple easily-understood manner? Can we get 85% of what we want without multiple congestion runs, markets driven by software, weird FTRs, and disconnected cash and real-time markets? I would argue we should advocate simplicity. What gives us the biggest bang for our buck coming out of the gate? Deal with that, implement it, see how it works, adjust as necessary, and then move on. The danger now is that people see California and deregulation as one in the same. They are not going to trust complicated changes, and it is going to be difficult to assure them they will work. We should be able to specifically lay out the top 5 issues we have with the way the Northwest market is structured now, why it costs money and/or is inefficient from a market perspective, and what simple steps could be taken to resolve these issues. I think we should become adept at explaining exactly why the California market did not work, and why the California market is not synonymous with deregulation and open, competitive markets. We may even want to sponsor some sort of conference. My bottom line is, I guess, is that I would like us to advocate smart changes for the sake of a sound market (even if they are simple and straight-forward), and not so much get hung up on what FERC thinks open-access is or should be.
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