
Date: Fri, 4 May 2001 12:30:00 -0700 (PDT)
From: james.steffes@enron.com
To: mark.crowther@enron.com
Subject: Re: Recommendations for Japanese Electricity Reform
Cc: steven.kean@enron.com, richard.shapiro@enron.com
Bcc: steven.kean@enron.com, richard.shapiro@enron.com

Some thoughts --

1. We argue against the PJM Installed Capacity obligation.  Basically it is
another rent capture system for generators.

2. Don't really understand your stranded cost recovery scheme.  Looks like a
transmission level charge.  Is it $/mw or $/mwh?

3. Your model for a pool doesn't solve the key problem of market power.
Putting a pool in place w/o dealing w/ market power is a recipe for disaster.

4. You don't talk about "Market Based Rate" authority.  Would all generators,
including incumbent generation be allowed to bid their price or must they bid
cost?  This is critical.  This is the real carrot to get the Utilities off of
the stick - mandatory participation with cost-based bidding for Incumbents
until under 1,000 (?) HHI.

Good luck,

Jim





Mark Crowther
