
Date: Tue, 24 Apr 2001 02:30:00 -0700 (PDT)
From: harry.kingerski@enron.com
To: robert.williams@enron.com
Subject: Re: FW: DA Account Balances
Cc: james.steffes@enron.com, jeff.dasovich@enron.com, mday@gmssr.com,
mike.smith@enron.com, richard.shapiro@enron.com,
vicki.sharp@enron.com, wanda.curry@enron.com, susan.mara@enron.com,
scott.stoness@enron.com
Bcc: james.steffes@enron.com, jeff.dasovich@enron.com, mday@gmssr.com,
mike.smith@enron.com, richard.shapiro@enron.com,
vicki.sharp@enron.com, wanda.curry@enron.com, susan.mara@enron.com,
scott.stoness@enron.com

Yesterday in a conversation with Mike Day, he confirmed we have no basis in
AB 1890 or anything else to claim entitlement to continuation of some type of
market based credits.  Given that interpretation, we tentatively decided the
advice letter protest would be drafted to say at least these things -
1)  the PE credit should include the 4 cents of surcharge (the 1 from January
plus the latest 3 now subject to rate design hearings)
2)  there is no restriction on the PE credit going negative.
3)  the tariff should be clarified to say it excludes DWR purchases, assuming
that is the case.

If we are going to otherwise object to the Advice Letter, the approach could
be:
1) the Commission needs to generically address the replacement of PX credits
and not allow one utility to change it through an advice letter;
2) the Commission has not addressed the entitlement of DA customers to hydro
assets and must make a determination on this;
3) if the Commission approves this Advice Letter, it should say SCE has no
further claim to stranded costs on its generation;
4) as an interim measure until the Commission fully looks at PX credit
calculations,  we recommend that SCE adopt a PX proxy, such as Dow Jones.

This approach allows us to argue process rather than entitlement to market
based credits.  Given all the time constrains, I'd suggest we capture these
latter issues through a very simple 1-2 paragraphs.

Bob, I know you're getting a call together; I'll call you to confirm.




