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Enron Mail |
The attached preliminary comments were finalized and filed with the Commiss=
ion this afternoon, in order to provide FERC staffers a concise, effective = statement of our position while they drafted the Judge's recommendation. I= was able to schedule a meeting with Judge Wagner, at which Dan Watkiss and= I stepped the Judge through the comments and hit the following high points= :=20 1. The methodology of the June 19 order does not work and is totally inapp= ropriate for marketers. If price mitigation is inevitable, the Judge shoul= d formulate or make allowances for a workable methodology. 2. The Judge should recommend that the end result of any Commission order = must be a just and reasonable finding for all periods, both prior to and af= ter October 2. 3. All buyers, including Enron, should be entitled to refunds; not just th= e State of California and its IOU's. Enron is a net purchaser in these mar= kets. 4. Only the state administered spot markets should be subject to the metho= dology, not bilateral contracts, OOM sales or sales to the DWR.=20 The details of these points appear in the attached document. The Judge was= receptive to most points. He understood the problems that the June 19 met= hodology presents for marketers and was agreeable to the notion that this s= hould be addressed, perhaps in the context of the hearings that will form p= art of his recommendation. He agreed that the actual buyers should receive= refunds, and it was his understanding that only spot transactions should b= e subject to the refund methodology. Although he agreed that the refund me= thodology, once implemented, should yield just and reasonable rates, he fel= t that this was outside the scope of his recommendation and that the matter= was up to the Commission. The Judge spoke generally and no promises were = made as to the content of his recommendations, but hopefully this insight w= ill shed some light as to the outcome. I urged the Judge to recommend plac= ing conditions to refunds, as the Commission did in its June 19 order with = its RTO filing requirement. The judge was noncommittal on this, although h= e did indicate that he felt refunds should be subject to offset. Next steps include filing our detailed comments by Thursday. The Judge tol= d us he would certify his recommendation to the Commission on Friday, and t= hat the comments would accompany the recommendation. Thereafter, it is lik= ely that the Commission would defer to the Judge's recommendation to hold a= fast track evidentiary hearing of 60 days duration, to determine "unresolv= ed issues of material fact". The scope of the hearing has not been determi= ned, but will probably include cost issues and might serve as a vehicle fo= r marketers to recommend an alternative methodology.
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