Re: Gallup - Continental Divide's contract proposal ,
 Any chance they could email electronic version of this Agreement?






Mark Knippa
08/05/99 10:17 AM
To: Gerald Nemec
cc:  
Subject: Gallup - Continental Divide's contract proposal


Gerald,

I am sending up a copy of the proposed contract structure from Continental 
Divide
who is the local power utility associated with the Transwestern Gallup 
station.

Overall the commercial terms seem to be in line with all the discussions that 
have
been referenced, although there are some issues we want to make vary clear or
more apparent.

1) ECS is agreeing to a 3 yr term "to buy power from Continental Divide" 
assuming
     the merger is completed and power is available to ECS through the No. 21 
tariff.

2) They have provided none of the information concerning a split demand 
charge 
      that totals $12.21/kw.  Discussions reflect that $8.86/kw is avoidable 
and tied to
      their monthly coincidental peak load and the remaining $3.35/kw is a 
base type
      demand.  This is the basis of the rebate mechanism for TW.  Note this 
is also
      a Tri-State portion and part of the tariff 21.

3) ECS is aware of more favourable contract structures that Tri-State has 
negotiated
     and wants to maintain the ability to utilize a more favourable 
tariff/contract structure 
     or to negotiate specifics with Continental Divide post the Tri-State 
merger.   We 
     would still be buying from Continental Divide supporting their 3 yr term.

I am trying to get some written specifics from Continental Divide / Tri-State 
relative
to the demand avoidance since they are currently using this structure today.  
I'll let
you know.

Otherwise I wanted to get the document to you for your review.

Thanks
mark.knippa@enron.com