Calpine/ TW Measurement and Control Facilities Operating Agreement

Jeff, here are Colleen's comments. At your convenience, let's meet to
discuss.
---------------------- Forwarded by Susan Scott/ET&S/Enron on 03/21/2000
10:16 AM ---------------------------

Colleen Raker
03/20/2000 07:37 PM
To: Susan Scott/ET&S/Enron@ENRON
cc:

Subject: Calpine/ TW Measurement and Control Facilities Operating Agreement

Attached is a black-lined version of my redraft of certain provisions of the
3/03/00 draft of the above Agreement. The purpose of my changes was to (i)
apportion the risk assumed by TW and Calpine based on the economic benefits
realized by the parties and the ability of a party to insure against the
risk, and (ii) to clearly identify the parts of the facilities to be serviced
by TW and the list of services routinely performed. I noticed that there is
no insurance coverage required of either Party. I expect that Calpine
insures its property against casualties and is therefore in the best position
to assume the risk of loss or damage to its property. On the other-hand,
third party property that is in the care, custody and control of TW while it
performs its work, is not covered by Enron's standard general liability
policies. Builder's risk coverage must be purchased to cover this risk; the
coverage is expensive. Section 5.4 and Section 4.1 reflect this reasoning.

If TW plans to limit its financial responsibility to the amount of money
collected by Customer from TW's insurance carriers, then an Insurance section
should be included, and the penultimate sentence of Section 5.4 further
edited to stipulate that limitation. If TW's limitation of liability is to
be a percentage of the total amount of revenues and compensation it receives
under this transaction, then that dollar-amount should be inserted in the
latter mentioned sentence of Section 5.4.

Please contact me if you have any questions about my changes.