Wade Stubblefield@EES
	    05/21/2001 04:23 PM

To:     Rogers Herndon/HOUIECT@ECT
cc:     Neil Hong~HOU/EES@EES
Subject: Re: FYI ~

Rogers,

The schedule originally attached included all activity through 5/17 and by default included the TXU curve
adjustment. It is not jumping out at you probably because we netted the quarter's activity (including
Hedge Management items) in with the curve shift items. I don't know how hard it is to break out
separately, but if you feel it would add more value please let me know and I'll find out (Neil - can you tell
how difficult it would be to show separately ctjrve shift from actual hedge costs?).

With respect to the I-Cap and other retail gen. adjustments, I think these were contemplated in the rough
$5OMM depicted on the schedule for Ancillary Charges - East under the outstanding items caption. If you
are aware of a different $5OMM item that that might pertain to, please let me know.

The mis-valued options rough estimate of $20 MM was what Don said Mark Jackson thought his exposure
was on options currently booked and just not valued properly. You're right that there are probably a lot of
options not even identified that will result out of the data cleanup effort (hopefully some of the $222MM set
aside from the top 13 deal review will cover some of that).

Thanks for your input and I hope the above has clarified some of your concerns. If you think it would be
of benefit to sit down and go over the entire list, let me know when you have a few minutes.

Wade
Rogers Herndon@ECT


	    Rogers Hemdon@ECT
	    05/21/2001 09:55 AM

To:     Wade Stubblefield/HOU/EES@EES
cc:     Kevin M Presto/HOU/ECT@ECT, John J LavoratofEnron@EnronXGate, James W Lewis/HOU/EES@EES,
	Don BIackIHOUIEES@EES
Subject: Re: FYI ~

Wade -

Some specific items we are currently analyzing that will have an impact on your assumptions:

TXU/North Texas Curve Adjustment    (11.5 MM)    This was put through on 5/17 and I am not sure
made it into your summary.
NY (Rest Of State I-CAP) Adjust            (20.0 MM)    Narsimha working on currently - will
forward details (I doubt this was planned for)
ECAR Retail Gen Adjustments         (07.0 MM)    Use appropriate wholesale curves and
congestion adjustments
Illinois PPO                        (04.0 MM)    Represents just one customer - J. Lewis working
on potential exposure

				    (42.5 MM)





 Currently, we are focusing on areas that will allow us to prepare for existing "new deal" flow.

 Areas that appear light to me in your analysis include option valuations (this will probably need to be fully
 resolved through the Contract re-evaluation process) and charges associated with the Illinois PPO roll-off.


 Will try to keep you informed of major changes as we address them.

 Rogers


Wade Stubblefield@EES

	   Wade Stubblefield@EES
	   05/18/2001 09:35 PM

 To     Rogers Hemdon/HOU/ECT@ect, James W Lewis/HOU/EES@EES
 cc:    Neil Hong/HOU/EES~EES
 Subject: Re: FYI

 Rogers/Jay,

 Attached is a copy of a reconciliation that Wes C. and John L. had asked for earlier today depicting (1) the
 makeup of the items included in the YTD DPR loss for WhEES (2) an estimate of the items projected to
 still hit in Q2 and (3) those items which we think are exposure items but which is doubtful we will have fully
 resolved during Q2.

 Neil H. provided the data for the items included herein, all of which you are hopefully aware of. Given the
 magnitude of the numbers and this point in the quarter, Wes has asked that we keep the attached updated
 on at least a weekly basis. Depending on the nature of future items that come up, we may want to
 convene a periodic meeting to discuss the items herein with all applicable parties.

 I apologize for not including you on the distribution earlier today, will make sure you are in the loop with
 regard to the content of the schedule going forward and will include both of you in all future
 correspondence.

 If you see anything unusual, or know of additional items which should be include, please do not hesitate to
 contact Neil or I.

 Thanks

 Wade


 WhFFS Frnn~,JrA - 5





Enron Wholesale Services - EES
Financial Forecast
As of May 17, 2001
(in millions)

lit Quarter
East Curve Shift
West Curve Shift
East Retail Gen Curve Adjustments
West Retail Gen Curve Adjustments
Utility Risk Mgmt T&D Curve Shift
Gas
Other

Subtotal 1st Qtr

2nd Quarter as of May 17. 2001
East Curve Shift
West Curve Shift
East Retail Gen Curve Adjustments
West Retail Gen Curve Adjustments
PGE/SCE Surcharge Adjustments
Utility Risk Mgmt T&D Curve Shift
IBM Direct Access to UDC Change
UC/CSU Direct Access to UDC Change
Gas
Other

Subtotal 2nd QTD as per DPR


Outstandlna Exoosure Items for 2nd Qtr
T&D - Rate Engine Correction
Ancillary Charges - East
Gas lntra-month True-up
Mis-valued Options in Existing Portfolio
Volumetric Re-forecasting
 - Pakaged Ice $(12); Arch $(8); Suiza $(1)

Subtotal Outstanding Q2 Exposure Items

Total Q2 Forecast

Other Potential ExDosure Items
DSM Project Options Reforecasted
DSM Implementation Risk Premium
Unbooked Pac Bell Option
Estimated Flash to Actual Adjustments
Top 13 Deal Review (see 'Deal Impact' tab)

Subtotal for Others

 (16)
 (22)
 (50)
 (57)
(171)
 (32)
 (71)
 (55)
 17
 (28)

	(485)


 (80)
 (50)
 (14)
 (20)

 (21)

	(185)

		(670)


 (52)
 (15)
 (20)
 (75)
(222)

		(384)

GRAND TOTAL                                                   $ (1,273)

$     (38)
      (62)
       (5)
      (18)
      (57)
      (24)
      (15)

$   (219)