Fuel Cell Exhibit C and D

Stephen--I think that we should arrange a conference call with Tony Leo to
discuss these items.

---------------------- Forwarded by Scott Healy/HOU/ECT on 11/29/2000 10:11
AM ---------------------------

Terri Austin@ENRON_DEVELOPMENT
11/29/2000 09:54 AM
To: Stephen Plauche/Corp/Enron@Enron, Scott Healy/HOU/ECT@ECT
cc: Michael D Nanny/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
Subject: Fuel Cell Exhibit C and D

Steve, Scott

Comments are as follows:

Exhibit D
Contains all modifications agreed and is acceptable. The Repalcement Stack
Test is missing from that document. I am attaching Tony's draft of it.
(Previously sent to you.)

Replacement Stack Testing:

Replacement Stack Performance Testing will be done following the replacement
of one or both stacks on each unit. The replacement stack performance
testing shall be performed to asses the new stack performance level and to
determine its contribution to the overall plant. Replacement stack testing
must include provisions to accurately determine stack performance and its
contribution to the overall plant performance. It includes detail evaluation
of the DC to AC conversion performance in order to be able to express the new
stack performance level in terms of plant net output and efficiency.

Exhibit C - Comment
A major Concern is the Correction Factor for thermal cycles! This seems to
be a steep correction, 1% for each cycle above 2 per year. This would
suggest is any type of cycling is done on the plant, the repalcement stack
could be needed as early as 1 to 2 years.
Please call to discuss

Exhibit C - Clarifications and Comments

Section C.1
1. Confirm Exhaust Stack height and/or diameter does not influence
guarantee up to 40ft. This is within FCE scope of supply.
2. Confirm the stack contains EPA test ports and platform/ladders for access.

Section C.3
1. Include drawing number and revision

Section C.4
1. Basis Conditions and Performance Correction Factors
Should read "Basis Conditions"

Table C.2 Site Basis Conditions
1. Elevation above Sea Level
Should be Ambient Barometric Pressure, psia, 14.69
2. Footnote for wind loading indicates 30 psf, design states 24 psf. Should
basis also state 30 psf? Or change to wind speed rather than load:
-- seems design basis should be wind speed (90 mph) and contractor has
responsibility for design interpretation of the UBC.
-- refer to UBC chapter 23, part II - Wind Design
-- identify Importance Factor, I, equal to 1.0 (or 1.15, as the civil
design requires).
3. Ambient dust loading on an annual average basis does not seem meaningful
for performance considerations. Use a 3-hour value?
4. Same comment for Ambient gaseous halide concentration
-- Have never seen reference to halides as a design basis. Please
explain.
5. Note 1 does not seem to belong to Table C.2. Relocate?

Table C.3 Fuel Compostion Range - Clarify the impact if the gas is above
these levels.
1. COS
2. 0.7 grain/100 SCF is max total sulfur
3. Same with water of 7 lb/MMscf.
4. Odorants

C.5 Correction Factors
1. Is this paragraph necessary?

C.5.1)
Table C.4
1. Correction factor alpha-T should be 0.84+.002*T if the factor is to be
1.0 at T=80.

C.5.2) Elevation
1. Change to barometric pressure. This is the measureable quantity. Will
only correct for barometric pressure.
2. Presents an equation for Max. Unit Output in terms of barometric pressure
where the term aH is introduced. This term should be aP.
3. Presents an equation for the correction factor aP.
The existing equation is: aP = 1.17 - P x 0.0015
Please confirm the equation should be: aP = 1.017 - P x 0.00015

C.5.5) Operating History
1. Clarify the definition of new-and-clean.
2. Any thermal cycles occuring during startup and commissioning and testing
by the contractor do not count?
3. Is there any consideration under which degradation is applied at the
original acceptance test?

Terri Austin