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Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Elizabeth Sager X-To: Christian Yoder, Steve C Hall X-cc: X-bcc: X-Folder: \Elizabeth_Sager_Nov2001\Notes Folders\Sent X-Origin: Sager-E X-FileName: esager.nsf ----- Forwarded by Elizabeth Sager/HOU/ECT on 05/01/2001 11:06 AM ----- Rebecca W Cantrell 05/01/2001 11:04 AM To: Richard B Sanders/HOU/ECT@ECT, Elizabeth Sager/HOU/ECT@ECT, Jeffrey T Hodge/HOU/ECT@ECT, Tim Belden/HOU/ECT@ECT cc: Subject: Breaking News : Williams Ordered to Pay $8 Million Refund to Cal-ISO FYI. ---------------------- Forwarded by Rebecca W Cantrell/HOU/ECT on 05/01/2001 11:04 AM --------------------------- Enron North America Corp. From: Rebecca W Cantrell 05/01/2001 10:21 AM To: Steve Walton/HOU/ECT@ECT, Susan J Mara/NA/Enron@ENRON, Alan Comnes/PDX/ECT@ECT, Ray Alvarez/NA/Enron@ENRON, Leslie Lawner/NA/Enron@Enron, Donna Fulton/Corp/Enron@ENRON, Jeff Dasovich/NA/Enron@Enron, Christi L Nicolay/HOU/ECT@ECT, Joe Hartsoe/Corp/Enron@ENRON, Linda Robertson/NA/Enron@ENRON, Richard Shapiro/NA/Enron@Enron, Shelley Corman/Enron@EnronXGate, James D Steffes/NA/Enron@Enron cc: Phillip K Allen/HOU/ECT@ECT, Barry Tycholiz/NA/Enron@ENRON, Stephanie Miller/Corp/Enron Subject: Breaking News : Williams Ordered to Pay $8 Million Refund to Cal-ISO From Natural Gas Intelligence: Breaking News : Williams Ordered to Pay $8 Million Refund to Cal-ISO posted 10:05 AM (CST) May 1, 2001 Williams Energy Marketing & Trading has been ordered by FERC to refund $8 million to the California Independent System Operator (Cal-ISO) and has had a "prospective condition" placed on its authority to sell power at market-based rates for a year as part of a stipulation and consent agreement. The agreement, which FERC approved Monday, was in response to a mid-March order that directed Williams Energy and AES Southland Inc. to show cause why they shouldn't be found in violation of the Federal Power Act (FPA) for allegedly engaging in actions that drove up prices in the California bulk power market and potentially compromised the reliability of the transmission gid. The two companies entered into the agreement with FERC's Market Oversight and Enforcement Section to resolve all the issues in the show-cause order [IN0I-3-001]. Specifically, the agreement calls for Williams to refund $8 million of the $10.85 million in additional revenues it received when two AES generation units, designated as reliability must-run (RMR) units, failed to provide immediate service to the Cal-ISO in April and May. The ISO was forced to call upon other non-RMR units and pay a much higher price (near or at $750/MWh) to Williams. Williams is the exclusive marketer for power from the two AES plants at issue --- AES Alamitos LLC and AES Huntington Beach LLC in Southern California. The Commission also conditioned Williams' market-based authority such that it will have to bear the financial cost of replacement power if a RMR unit is unavailable at any time over the next year. Significantly, the agreement does not find that either Williams or AES abused their market power in California. It rejected the California Public Utilities Commission's request to impose penalties --- over and above refunds --- on the companies. Moreover, the agreement does not put an end to the "formal, non-public investigation" that FERC ordered in mid-March into violations arising out of the conduct of Williams and AES.
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