California QFs - Gas Hedging

----- Forwarded by John J Lavorato/Corp/Enron on 01/21/2001 08:38 PM -----

Christopher F Calger@ECT
01/21/2001 04:00 PM

To: Barry Tycholiz/NA/Enron@ENRON
cc: John J Lavorato/Corp/Enron@Enron
Subject: California QFs - Gas Hedging

Barry,

FYI the California QF's are negotiating a settlement deal with Edison and the
state of California which would fix energy payments over five years.
Currently the energy payments are indexed to Socal Border because a majority
of the Edison QF's buy spot gas. If this settlement happens, the QF's will
likely want to buy financial swaps. The Edison gas-fired QF's represent
about 500MMCF/Day of gas.

Chris