California Update 7/25/01----Meeting w/Assembly on Its Latest ,
 Adding to Kristin's update, here's the summary of a meeting that just occured 
with Assembly leadership staff and industry on the Assembly's latest version 
of an "Edison MOU":

The Speaker's staffer said that if he had to bet at this time, he would bet 
that the Assembly would not convene on Friday.
He also said that, if it doesn't happen on Friday, nothing will happen until 
they get back from recess on the 20th of August.
The Assembly will let folks know by tonight or first thing tomorrow whether 
they intend to move forward with a vote on Friday or recess.
From the most recent proposal released today by the Assembly leadership, it 
appears that the centrist Democrats are prevailing.  The proposal:
Retains Direct Access (though they said that they are continuing to be 
pressured by the Treasurer, who wants DA suspended due to the bond issuance)
Places 80% of Edison's past debt with large customers (leaving 20% with small 
customers, which business customers or strenuously opposing).
Eliminates all references to any purchase, or option to purchase, Edison's 
transmission. (They said there simply ain't the votes to buy, or consider 
buying, Edison's transmission in the Assembly)
Maintains the Senate provision, which would pay the banks, pay the QFs, but 
place with Edison the risk of figuring out how to pay the $1billion owed to 
suppliers. (Even the munis are begining to complain about those provisions.)
Creates a tradeable, renewable portfolio standard (conceptually similar to 
the one created in Texas).
The new bill is created by 1) amending SB78 and 2) gutting a different bill 
passed from the Senate to the Assembly, SB39, and replacing it with the new 
version of 82XX.  The two would go together to create the Assembly's newest 
proposal.
If this bill gets voted out of the Assembly, it will likely have a difficult 
time getting the votes necessary to pass in the Senate, since the Senate has 
considered and rejected several provisions currently included in the Assembly 
version.
Will report back on whether the Assembly's going forward or adjourning for 
recess as soon as we hear.

Best,
Jeff
----- Forwarded by Jeff Dasovich/NA/Enron on 07/25/2001 06:26 PM -----

	Kristin Walsh/ENRON@enronXgate
	07/25/2001 04:30 PM
		 
		 To: John J Lavorato/ENRON@enronXgate, Louise Kitchen/ENRON@enronXgate, David 
W Delainey/HOU/EES@EES
		 cc: Christopher F Calger/ENRON@enronXgate, Christian Yoder/ENRON@enronXgate, 
Steve C Hall/ENRON@enronXgate, Mike Swerzbin/ENRON@enronXgate, Phillip K 
Allen/ENRON@enronXgate, Jeff Dasovich/NA/Enron@Enron, Chris 
Gaskill/ENRON@enronXgate, Mike Grigsby/ENRON@enronXgate, Tim 
Heizenrader/ENRON@enronXgate, Vince J Kaminski/ENRON@enronXgate, Steven J 
Kean/ENRON@enronXgate, Rob Milnthorp/ENRON@enronXgate, Kevin M 
Presto/ENRON@enronXgate, Claudio Ribeiro/ENRON@enronXgate, Richard 
Shapiro/ENRON@enronXgate, James D Steffes/ENRON@enronXgate, Mark 
Tawney/ENRON@enronXgate, Scott Tholan/ENRON@enronXgate, Britt 
Whitman/ENRON@enronXgate, Lloyd Will/ENRON@enronXgate, Alan 
Comnes/ENRON@enronXgate, Rogers Herndon/ENRON@enronXgate, James W 
Lewis/HOU/EES@EES, Don Black/HOU/EES@EES, Kelly Holman/ENRON@enronXgate, Mark 
Dana Davis/HOU/ECT@ECT, Fletcher J Sturm/ENRON@enronXgate, Doug 
Gilbert-Smith/ENRON@enronXgate, Richard B Sanders/Enron@enronXgate, Andrew 
Edison/ENRON@enronXgate, Kelly Holman/ENRON@enronXgate, Nancy 
Turner/ENRON@enronXgate, Tim Belden/ENRON@enronXgate, John 
Brindle/ENRON@enronXgate, David Cromley/ENRON@enronXgate
		 Subject: California Update 7/25/01 p.3

Details are still rough and the situation is very fluid, but here is what is 
currently going on:

Senators Hertzberg and Keeley are amending both SB 78XX and AB 82XX.  Upon an 
initial read, it appears that they are doing the following:
? AB 82XX has been gutted except for the direct access provisions and the 
renewables portfolio.  (The core/non-core business provisions, the 
transmission asset purchase, etc. all appear to have been deleted.)  Both of 
these provisions that have been left in the bill were seen as positive by 
members last week when the bill was first debated. 
? It appears amendments have been made to SB 78XX but the extent of these 
changes are not yet known.  
? At the beginning of both amended bills, it states, "As proposed to be 
amended into SB_XX."   This means that amendments to SB 78 could be 
incorporated into AB 82, and vice versa.  Another possibility is an entirely 
new bill.
christopher.calger@enron.com, christian.yoder@enron.com, 