
Date: Tue, 5 Dec 2000 03:22:00 -0800 (PST)
From: mary.hain@enron.com
To: joe.hartsoe@enron.com, richard.ingersoll@enron.com
Subject: WSCC ADR proposal
Cc: james.steffes@enron.com, bernadette.hawkins@enron.com,
christian.yoder@enron.com, elizabeth.sager@enron.com,
steve.c.hall@enron.com, paul.kaufman@enron.com
Bcc: james.steffes@enron.com, bernadette.hawkins@enron.com,
christian.yoder@enron.com, elizabeth.sager@enron.com,
steve.c.hall@enron.com, paul.kaufman@enron.com

I have reviewed the ADR proposal and have the following comments.

This ADR proposal is a double edged sword.  On the one hand - as members of
WSCC it will help to protect us from antitrust liability.  On the other hand,
only full members of WSCC are obligated under the ADR provisions (Section
12.1), so just like the ADR provisions of NRTA/WRTA/SWRTA, entities merely
have to quit WSCC to get out of the ADR obligation.  This is especially
problematic with entities that are not FERC jurisdictional.  But, I think, on
balance, we are probably more concerned about the antitrust protection, given
that the WSCC usually makes decisions that effect operating systems much more
than marketers, although this is changing over time.  What do others think?
I agree with the proposal to have binding arbitration for such controversial
matters as transmission path ratings.  Section 12.6.2.  The lack of such a
mechanism has created extended FERC litigation concerning the Alturas line.
Further, I agree with the grounds for appealing the arbitration decision
(contrary to law, arbitrary and capricious, lack of a fair hearing, or
serious arbitrator misconduct).  Section 12.9.1.  However, the process for
requiring FERC filings (under Sections 12.11) seem to undermine the binding
nature of the arbitration provisions.  To really be binding, it seems like
once the appeals process has been completed, Section 12.11 should require the
prevailing and non-prevailing party to file joint filings to carry out the
binding arbitration decisions.

