TC/FE Workplan

Rick,

I think this is closer to what we had originally envisioned and addresses your comments on streamlining. Do you agree?

-----Original Message-----
From: "Kevin Wellenius" <kevin.wellenius@frontiereconomics.com<@ENRON [mailto:IMCEANOTES-+22Kevin+20Wellenius+22+20+3Ckevin+2Ewellenius+40frontiereconomics+2Ecom+3E+40ENRON@ENRON.com]
Sent: Wednesday, August 29, 2001 12:25 PM
To: Guerrero, Janel; ellen@tca-us.com; sle@tca-us.com
Subject: Critical elements

Janel, Scott and Ellen:

It seems that the initial 'high level' message may simply need to establish
broad support for federal-level coordination, as opposed to addressing
concerns or objections, which would be developed later. The initial set of
Level 1 messages could then look like:

1. The federal government has been used to facilitate inter-state
coordination of a variety of issues. (Support by a few analogies or
historical examples, and point to federal action already taken in the power
industry including NERC...etc.)

2. The electric power grid could benefit from such coordination. (Support by
the 'natural markets' graphic showing that markets are bigger than states.

3. Voluntary processes have been arduously slow, and currently point to a
patchwork of RTOs. Therefore, federal action is both useful and necessary.
(Support by graphic of 17+ proposed RTOs)

4. Summary of economic benefits from eliminating redundant agencies and
improved operational efficiency.

5. "The lights will stay on" - no change in reliability standards, and
increased interconnection allows reserves to be shared.

This could probably be accomplished in 3-4 pages using bullet-note format.
Can provide separate 2-page Q&A that addresses anticipated concerns.

Level 2 would draw on more quantitative material and address the nuts and
bolts of RTO design as well as the governance issues. What I outlined above
simply makes the case for federal action on this front.

Kevin