FERC requests comments on re-imposing price cap on releases ,
 This afternoon the Commission has issued an Order Requesting Comments in the 
SDG&E and LA Dept. of Water & Power petition proceedings on the short term 
capacity release price cap (RP01-180, RP01-222).

The order requests comments on "whether...[to] reimpose the maximum rate 
ceiling on short-term capacity release transactions into California and the 
effects of such action on the California gas market."  Order and attachment 
are attached at the bottom of this email.  Print to read all footnotes 
(original came in WordPerfect).

Note that in footnote 2, the order explains the current comprehensive 
Commission approach to the gas market in California, and that they're 
reaching out for the gray market:  "On May 18, 2001, in Docket No. 
RM01-9-000, the Commission issued an order proposing to impose certain 
reporting requirements on natural gas sellers and transporters serving the 
California market.  The proposed reporting requirements are intended to 
provide the Commission with the necessary information to determine what 
action, if any, it should take within its jurisdiction.  Our order today 
coupled with our May 18 order continues to focus on issues related to natural 
gas prices in California and actions we may take to address capacity release 
transactions and bundled sales (i.e., the "gray market")."

To note in this order, the discussion includes an explanation that FERC 
Staff's analysis of capacity release data between Nov. 2000 and April 2001 
shows that only .09 to 1.2 percent of the volume of capacity releases into CA 
were above the maximum tariff rate.  In light of this information, the order 
requests comment on whether the price cap into California would be reimposed 
on short term releases prior to Sept. 30, 2002.

Comments are due in  20 days.  Questions asked in the order are:  (1) Would 
reimposition of the maximum rate ceiling on short-term capacity release 
transactions into California have any significant effect on the price of gas 
at the California border; (2) Should the reimposition of the maximum rate 
ceiling on short-term capacity release transactions be limited to California 
or extended to pipelines delivering into the Western Systems Coordinating 
Council (WSCC) region; (3) What effect do capacity release transactions have 
on wholesale electric prices; (4) What would be the effect of reimposing the 
maximum rate ceiling on short-term capacity release transactions into 
California given firm shippers' ability to make bundled sales at the 
California border; and (5) How will reimposing the maximum rate ceiling for 
short-term capacity release transactions into California impact shippers' 
ability to obtain short-term firm capacity.

An excel attachment to the order details the Staff findings on Transportation 
Release Transactions above the max. rate Nov. 2000 - April 2001
stanley.horton@enron.com, steven.kean@enron.com, shelley.corman@enron.com, 