KY and TN Governor's Energy Policy Actions

Last week, Governor Patton issued an order imposing a moratorium on accepting
new power plant applications for 6 months. He also ordered the PSC and Env.
Protection Cabinet to study the effects of new plants on the environment and
the issues related to the impact on the grid, siting issues and econ. dev.
He also directed the agencies to give particular attention to preserving and
enhancing the use of KY coal. Enron recently filed an application at the
Env. Protection Cabinet for an air permit on the Calvert City site. Ben
Jacoby informed me that we are going to have to change the application.
Based on his consultant's read of the order, we will be able to do so w/o
being subject to the moratorium. Gov. Patton has also set up an energy
policy committee. Bill Butler, with the local chamber of commerce for
Calvert City has apparently been appointed to the committee. Ben has worked
closely with Bill over the years to get Calvert up and running. I am
monitoring this committee for Ben.

Also, in TN, the Governor is going to form an inter-agency work group on
energy policy. I have received what appears to be an internal document on
this. Robert Gowan at Stoke Bartholomew thinks this is being motivated by
TVA and their concerns on air emissions limitations. Apparently there are
going to be 2 phases to the work group -- the first is going to be to improve
state government's use of energy. The state just this week has
enthusiastically agreed to EEIS' proposal for the FASER upgrade. They have
asked EEIS to provide input on phase 1. I have spoken with Pam Rosen who has
agreed to keep me in the loop on anything having to do with the working
group. Phase 2 is going to focus on an overall state energy policy. As you
know, ENA has a sight under development outside of Memphis and EES is on the
short list in Nashville for a facility deal. I have notified Ben Jacoby and
Jeff Ader on these developments. I will continue to follow this issue.

As these states get these groups underway, I will keep you posted. We will
have to take a close look at these and determine whether to get involved and
if so, how.