Illinois Power and ISU

Rick -- FYI on Illinois State University
----- Forwarded by Roy Boston/HOU/EES on 07/02/2001 11:24 AM -----

=09Roy Boston 06/29/2001 03:57 PM =09 To: Eric Pitcher, Tim Nowaczyk/HOU/=
EES@EES cc: Janine Migden/NA/Enron@Enron, Harry Kingerski, jsteffe@enron.c=
om, Barb Novak/HOU/EES@EES Subject: Illinois Power and ISU=09

Eric and Tim -- This is a note to bring you up to date on my attempts to re=
solve the ISU/IP issue. As you are aware, IP has threatened to impose a re=
troactive standby charge to Illinois State University, our customers, if it=
uses its on site generation for peak shaving purposes this summer. When I=
SU was an IP customer, the utility did not impose such charges, but noe tha=
t they have lost their PPO and have reverted to SC21 this was made an issue=
.

I spoke with Kathy Patton last week and told her the situation. She respon=
ded to me today and indicated that a final answer cannot be given until ear=
ly next week because the VP over major accounts is out of the office. She =
indicated that her peole said that ISU never used on-site generation for pe=
ak shaving purposesand instead used them only for back-up, hence no standby=
service was required previously. I told her that that was not accurate an=
d that this is a new and unwarranted change in requirements that is not sup=
ported by IP's tariffs. I also informed her that the units are electricall=
y isolated from IP's system through a make-and-break switch system and coul=
d obviously not be served by two power sources. Further, since ISU has abou=
t 25 of these small units scattered around its campus in Normal, Illinois, =
the likelihood that a significant percentage of these units would fail and =
require IP to standby is virtually zero. I also told her that she was in t=
he middle of this and that I did not believe that she was getting the full =
story from her people but that I was not interested in playing a blame game=
, but rather wish to avoid an unnecessary confrontation that serves nobody.=
She agreed and indicated that she would call me Tuesday, July 3 and give =
me IP's position. I have positioned this as a misunderstanding on the part=
of IP's account representative.