|
|
Enron Mail |
Bob, see my comments below. I hope you got the message that I will not be =
in the office on Friday due to other issues at SCE. Let me know if you thi= nk I should go to San Francisco from here to meet with the lawyers. Page m= e if you need to visit. 888.740.8480. =20 From:=09Robert C Williams/ENRON@enronXgate on 08/08/2001 07:10 PM To:=09Janet R Dietrich/HOU/EES@EES, Lamar Frazier/HOU/EES@EES, Andrew Wu/HO= U/EES@EES, James D Steffes/ENRON@enronXgate, Kevin Keeney/HOU/EES@EES, Rona= ld Adzgery/HOU/EES@EES cc:=09Vicki Sharp/HOU/EES@EES, Richard B Sanders/Enron@enronXgate, Mark E H= aedicke/Enron@EnronXGate, Lisa Mellencamp/ENRON@enronXgate, Michael Tribole= t/ENRON@enronXgate, Wanda Curry/ENRON@enronXgate, Diann Huddleson/HOU/EES@E= ES=20 Subject:=09EES Billing Issues Privileged and Confidential Attorney-Client Communication This is to recap our discussion today about two billing issues--recoupment = of the PX Credit and the $10 surcharge. I would appreciate it if those of = you with more first-hand information, particularly Wanda and Diann, correct= or clarify anything I've misstated. Also, please forward this to anyone e= lse with an interest in this matter. A. Recoupment of the PX Credit (also known as the "Negative CTC") 1. Background: The issue here relates to the fact that PG&E and SCE = are no longer reflecting credit balances on the bills for our customers. P= rior to our returning the customers to bundled service in March, the bills = would reflect the PX Credit as an offset to T&D charges. SCE and PG&E have= now removed the PX Credit from the bill and are attempting to charge us fo= r T&D, despite the fact that they owe us hundreds of millions of dollars in= PX Credits. The PX credit has been replaced with the PE credit, so we are= receiving an energy credit, just not calculated the same way as the PX. = This is potentially harmful particularly in view of the opinion of perhaps = three of the Commissioners that the PX Credit can only be collected as a bi= ll credit, and not in cash. Mike Day, our regulatory lawyer, expressed his= strong opinion that removing the Credit from the bills was improper, and t= hat we should challenge the action by making a filing with the CPUC. Note:= the PX Credit to which I am referring here is that which accrued to prior= to December 31, 2000; the utilities do not dispute that a PX Credit accrue= d during that time frame, and there is no dispute as to the proper methodol= ogy for computing the PX Credit for that time frame. Furthermore, PG&E and= SCE are in virtual agreement with us as to the amount of the Credit that h= ad accrued as of December 31, 2000. 2. Action Items/Issues: (a) With respect to SCE, Legal is evaluatin= g filing a suit in federal court versus filing at the CPUC. The CPUC has a= process whereby we could prevent the utilities from disconnecting our cust= omers while the issue is being determined (by depositing the payments in an= interest-bearing account controlled by the CPUC); while there is no equiva= lent procedure in federal court, one can request that the court enter an in= junction against the utilities disconnecting customers. While the analysi= s is worth doing, I suspect that we will conclude that we have to go to the= CPUC for relief. (b) With respect to PG&E, the banruptcy team is evaluat= ing whether to file at the CPUC or in bankruptcy court. 3. Timing: Late fees will begin accruing August 20. I will need to c= onfirm when late fees will begin accruing. SCE late charges are calcuated = at .9% of total owing. The first disconnect notices would not be received = until September 19. Disconnect notices will be directed to Enron not the c= ustomer. PG&E will begin demanding payment before SCE. 4. Effect on other CTC issues: Pursuing action at the CPUC or in cour= t to force the utilities to restore the PX Credit to our bills has no eff= ect on the issues of how the CTC should be calculated post-January 17, and = prospectively. Both utilities are providing a credit (PE) at this time. I= t is their methodology we are disputing. B. $10 Surcharge 1. Backgound: Although when provisionally imposed in January the $10= surcharge went to the utilities to keep them financially solvent, when ma= de permanent in March it became dedicated to defray the DWR's purchases of = power on behalf of the utilities. This evolution gives rise to two bases f= or EES to argue that it should not bear the financial burden of the $10 sur= charge. First, since the $10 surcharge is now dedicated to purchasing gene= ration for bundled customers only, and not direct access customers, direct = access should not have to pay it. This is the same logic that caused the C= PUC to exempt direct access customers from the $30 surcharge. Secondly, if legitimately applied to direct access, because it is of no dir= ect benefit to direct access customers it (arguably) can only be viewed as = a tax. Under EES's contracts with its customers, taxes assessed at the del= ivery point are borne by the customer. Note: SCE, unlike PG&E, may not im= pose the $10 surcharge on direct access customers, according to a filing ma= de at the staff level at the CPUC, so this action may relate to PG&E only. = SCE is NOT imposing the $10 surcharge as it is credited back to us in the = PE credit. =20 2. Action Items/Issues: (a) Regulatory (Jim Steffes) has the lead i= n advising us about a challenge to the application of the $10 surcharge to = direct access customers at the CPUC. It may be advisable for an industry g= roup rather than Enron to make the filing. (b) I would expect that we wou= ld follow the same procedure outlined above--depositing the payment with th= e CPUC--to prevent any customer from being disconnected. In the interim we= would likely bill the customer for the surcharge and promise a credit if o= ur challenge to the application of the surcharge to DA customers is success= ful. © A decision will need to be made on how far we go back--to July 1 w= hen the customers became DA again or to January 4 when the surcharge was fi= rst imposed. 3. Timing. Same timeframe as with the Recoupment issue since we will= need to have CPUC challenge on file to prevent late fees and disconnect no= tices. 4. Effect on other CTC issues: Regulatory (Jim Steffes) will analyze= with the appropriate people the effect, if any, of taking this position on= other CTC issues (principally how CTC should be calculated post-January 17= , and prospectively). CTC's have not been collected since the PX prices wen= t out of control last year. It is the Procured Energy Credit we need to ch= allenge. End. =20 =20
|