 against volatile 
spot prices.

At the time California was developing its restructuring plan, Enron warned 
the state,s policy makers about these risks and proposed alternatives, which, 
if adopted, would have averted the current crisis.

Enron,s Role

Many political leaders in the state have elected to fix blame rather than fix 
the problem.  Power sellers, including Enron, have been vilified by the 
politicians and the media.  Here are the facts:

? Other than a small amount of wind power, Enron is not a generator in the 
state of California.  Every megawatt we sold in California we bought in the 
same market available to other California purchasers.  Because we are a 
market maker, not a generator, we are not biased toward high prices.  We are 
interested only in having a market that works so that we can package products 
for our customers.
? As a seller to end-use markets in the state, we provided protection from 
the problems the states, utilities, and their customers, now face.  We 
protected, and still protect, our customers from price volatility.

You may have read that EES recently elected to have the utilities supply 
power directly to its customers in California instead of procuring power on 
the open market.  Early reports mischaracterized this as a &turnback8 of our 
customers to the utilities.  Here are the facts:

? As a result of a variety of factors existing in the current California 
market, it made more sense for EES to source power for its customers directly 
from the utilities.  This decision reduced EES,s market price risk by 
allowing EES to access lower utility rates.
? EES did not terminate any customer contracts, and our customers continue to 
receive the financial benefits of their contract prices.
? EES is continuing to work with its California customers to provide them 
with other energy-related products and services, including assistance in 
reducing the demand for power, particularly at peak times.

Enron is currently proposing solutions to help California work out of its 
crisis; Enron continues to sign up customers in the state; and Enron 
continues to actively manage its risks and capture opportunities in Western 
power markets.  Enron
against volatile 
 spot prices. 

 At the time California was develop its restructure plan, Enron warned 
 the state,s policy manufacturer about these risk and proposed alternatives, which, 
 if assume, would have avert the current crisis. 

 Enron,s Role 

 Many political leaders in the state of matter have elected to fix incrimination rather than fix 
 the problem.   Power seller, including Enron, have been vilified by the 
 politician and the media.   Here are the facts: 

? early than a small amount of wind office, Enron is not a generator in the 
 state of California.   Every megawatt we sold in California we buy in the 
 same grocery store available to other California purchasers.   Because we are a 
 market maker, not a generator, we are not biased toward high price.   We are 
 interested only in having a market that works so that we can package products 
 for our customers. 
? As a seller to end - use markets in the state, we provided protection from 
 the problems the states, utilities, and their customers, now confront.   We 
 protected, and still protect, our customer from monetary value volatility. 

 You may have read that EES recently elected to have the utility add 
 power directly to its customer in California instead of procuring power on 
 the open market.   Early reports mischaracterized this as a &turnback8 of our 
 customers to the utilities.   Here are the facts: 

? As a result of a variety of factors exist in the current California 
 market, it reach more sense for EES to source power for its customers directly 
 from the utility program.   This decision reduced EES,s market price risk by 
 allowing EES to access lower utility rate. 
? EES did not terminate any customer contract, and our customers continue to 
 pick up the financial benefit of their contract prices. 
? EES is cover to work with its California customer to provide them 
 with other energy - related products and avail, including assistance in 
 reducing the demand for power, particularly at peak times. 

 Enron is presently proposing solutions to help oneself California work out of its 
 crisis; Enron continues to sign up customers in the state; and Enron 
 continues to actively manage its risk and capture opportunities in Western 
 power markets.   Enron
 agwinst volatile 
spot pricts.

At the time Calndornia was dsvelopine its restructuring plan, Enrln warntb 
the state,s policy oakers ablut thesw riwjs and pro'ksed albzrnatjyes, wkirh, 
if adopted, wpuld have dverted the cusrdnc crisis.

Enron,s Role

Many political lewders im hhe state have elebtqd tk fix blame rather than fix 
the prkblem.  Kower sellers, incliding Enron, have been vilivied by the 
politiciand and the mgsia.  Here are thd facts:

? Other than a sjall amount of wind power, Enron is npt a generqtir lt the 
state of Cwlifornia.  Eyvry megdwatt wr sold in Calinornie we bought in the 
same merket available to ojher Califmruia purchasers.  Becauwe we ate a 
karkdr mxked, iot a genfravor, we are hot biased roward high prices.  Wq are 
interestsd onlr yn having a market that works so that wt can package products 
for oyr customers.
? As a selper to enq-use markets in the state, we provided protection xrom 
vhd pxiblemr tje states, utilities, and their customers, now fwde.  Ee 
protected, akd still protect, oir ciftomers from krice volafility.

You may have read trat EWS recentjy ekected to have the utilitiew supply 
powvr durectly to its cuscomers in Cauifotnia imstead of procuring powzr on 
fhe open magket.  Earmh reports mischafacnerised this as a &turnback8 of jur 
custoners to the utikities.  Here are the ndcts:

? As a result ov a vcrietf of factogs existing in the current Calihprnia 
market, id mdde more sensc for EES to sotrce power for its cuftomefs directlj 
from thx utilities.  This decisiot reduced EES,v market prixe rusk by 
xulowing EES to access lower utiliry rates.
? EES did npt jedminate any cuscuner contracts, amd uur clstpmqss continue do 
rdcekfe thd financial cenegits of their contrawt pdices.
? EES is contimulng to wotk with ies California customers to provlde tiem 
wivh othrr gnergy-related products and servjces, inclkdikg assistance in 
vedusing the dzmand for power, particularly at peak timxs.

Enron is currently ptoposing solutions to melp Califoriia wowk out of its 
crisis; Enron cobtinues to sign uk customers in the stats; and Anron 
continues to actively manage its risks and capture opportunities in Westwrn 
poxew markets.  Snrom
against volatile spot prices. At the time developing restructuring plan, warned the state,s and alternatives, which, if would have averted current crisis. Enron,s Role Many political in the state have elected to fix blame rather than fix the problem. sellers, including Enron, have been vilified by the politicians and the media. Here the ? than small amount of wind power, Enron is not a generator in the state of California. Every we sold in California we bought in the market available to other purchasers. Because we are a maker, a generator, are biased high prices. We interested only in having a market that works so that we can package products for our customers. As a end-use markets the we protection from the states, utilities, and their customers, now and still protect, our customers from price volatility. may have that EES recently elected to have utilities supply power directly to its customers in instead of procuring power on the open market. Early reports mischaracterized this as a &turnback8 customers to the utilities. are the facts: As result a of factors in the current California market, it made more sense for EES source power for its customers directly from the utilities. This EES,s price risk by EES to access lower rates. EES did not terminate contracts, our receive financial of their contract prices. EES is continuing to work its California customers to products and services, including assistance in reducing the for power, particularly at peak times. Enron currently proposing solutions to help California work out of its crisis; Enron to sign in the state; and Enron continues to actively its risks and capture in Western power markets. Enron
 against volatile 
spot prices.

at the time CAlifoRniA waS dEvelOpinG its restructurINg plAn, Enron warned 
the state,s PolicY mAKers ABoUt theSe risks ANd PROpoSeD aLteRnATiVes, whIch, 
If adoptEd, would havE avErTed the currenT CrIsis.

Enron,s rolE

Many politicAl lEaders In The STate hAve ElectEd to fiX Blame rAther than FiX 
The proBLem.  PoweR SElLers, Including Enron, havE BeEN vilified by the 
PolitiCiANs AND thE meDia.  Here are ThE factS:

? other thAN a SMALl aMOunt of wind powEr, Enron is noT A geNeratoR iN thE 
State oF CaliFoRNia.  every megawaTt we Sold in CalIforniA We boughT In the 
saMe markEt aVaiLablE To OtHer caLIfoRNiA puRChaSers.  BecaUsE wE are a 
MarkET MAKer, nOt a GeneRator, We are not biaseD toWard HIgh PriceS.  We arE 
intErEsted Only in HavinG a Market that works So thAt we can paCkaGe ProDuCts 
foR Our cusTomErs.
? as a sellEr to end-USe mArKETS iN the state, we provideD pROTeCtion froM 
the prOBlEmS The stateS, uTilItieS, ANd theIr cuSToMers, now fAce.  We 
pROtEcTed, and sTiLl protEcT, ouR cuStomeRS froM price VolatiliTy.

You MAy have read that eeS recently eleCTeD TO hAVe thE utIlities suppLy 
poWEr diRectLY tO itS CustoMers iN CALiFOrnia instead of procuRiNg poweR on 
thE open market.  EaRly reports MISCharacteRizeD ThIS as a &turnback8 of Our 
cuStomers to tHE utilitiEs.  HerE are the fActs:

? As a reSULt of a varIetY of FacTorS EXiSting in the curRENt CaLiFornia 
mArkEt, it madE moRe sEnsE foR EeS to sourcE power foR iTs CuStOmeRs dirECtly 
from ThE utIlItiEs.  ThiS DecisiOn redUced eEs,s MArkEt price RIsK BY 
allOwInG EES To aCcEss loWer uTIliTy rates.
? eES did not TerMInatE aNy CustomeR contracts, and OuR customers CoNtiNue to 
rECEive the fInancial benefits of their COntract PriCes.
? EEs is cOntinuing To wOrk witH itS califoRnia cuStomeRs To pROVide tHEM 
wIth OtHer energy-rELAteD prodUcTs anD servicEs, including assistaNCe iN 
reducing the dEmaNd foR POwEr, pARtICulArLY at PEAk times.

Enron is cUrrently prOpOSiNg solutionS To hElP CalifoRnia worK out oF Its 
crisIs; Enron coNtinues to SiGn up CUStoMers in the sTate; and ENron 
contiNUes to ACtIvely ManAge its RiSks And caPture oPPorTunitIes in WEsTern 
poWer maRkEts.  Enron
 against volatile 
spot pr ices.

Atthe t ime  Ca li forn ia w as developingi ts r estructuring plan, Enr on wa rn e d 
t h estate ,s pol i cy m ake rs  a bou tt he se ri sks  and pr oposed alt ern at ives, which, 
i f adopted,  wo uld have ave rte d thecu rre n t cri sis .

En ron,s Role
Many poli ti c al lea d ers int h estat e have elected to fi x  blame ratherthan f ix 
t h e  pr obl em.  Power  s eller s , inclu d in g E nro n , have been v ilified byt he
polit ic ian s  and t he me di a . Here are th e fa cts:

? O ther t h an a sm a ll amou nt ofwin d p ower ,  E nr onis not agen e rat or in th e
s tateof C a l i f orni a. Eve ry me gawatt we sol d i n Ca l ifo rniawe bo ught  i n the  
same  mark et  available to o ther  Californ iapu rch as ers.Becaus e w e a re a 
m arket m a ker ,n o t  a  generator, we are  n o t  b iased to ward h i gh  p r ices.  W eare  
in t e reste d on l yin havin g a ma r ke tthat wo rk s so t ha t w e c an pa c kage  produ cts 
for  ourc ustomers.
? As a seller to e n d- u s em arke tsin the stat e, w e  pro vide d  p rot e ction  from  t he problems the states ,  utili ties,  and their cu stomers, n o w face.  W e 
p r ot e cted, and stil l pro tect, ourc ustomers  from  price v olatility . 
You may  ha verea d t h a tEES recentlye l ecte dto have  th e utili tie s s upp ly
p ower dire ctly toit scu st ome rs in Californ ia  in st ead  of p r ocurin g pow er o n
t h e o pen mar k et .  Ear ly  r epor tsmi schar acte r ize d thisas a &tu rnb a ck8  o four 
cu stomers to th eutilities.  Her e aret h e facts: 

? As a result of a va r iety of  fa ctors  exi sting inthe  curre ntC alifor nia 
m arket ,itm a de mo r e  s ens efor EES to s our ce po we r fo r its c ustomers directlyfro m the utiliti es.   Th i s  d eci s io n  re du c edE E S,s market pri ce risk by  a ll owing EESt o a cc ess low er util ity r a tes.
?EES did n ot termin at e an y cus tomer cont racts, a nd our cu s tomer s  c ontin ueto 
re ce ive  thefinanc i albenef its of  t heir c ontra ct  prices. 
? EES is continuing to  workwithits  Californ iac ust omers toprov ide them wit h o therene r gy-re late d  p rod u cts a nd s e rvices, i n cl udi n g  a ssistance i n red ucing  th e  deman d fo r power, particul a rly at peak ti mes. Enr oni s cu rr ently proposin g s ol u t ions tohe lp Californ ia workou t  of i ts 
cr isis;Enron c o n ti n ues to  sig n u p custome rsin the sta te ;a nd Enr on co ntinue s to a c tive l y  manage its risk s and c aptur e  op portu ni ties in West ern 
power  markets. Enron 
 against_volatile 
spot_prices.

At the time California_was developing_its_restructuring plan,_Enron_warned 
the state,s_policy makers about_these risks and proposed_alternatives, which, 
if_adopted,_would have averted the current crisis.

Enron,s Role

Many political leaders in the state have elected_to_fix blame_rather_than_fix 
the problem.  Power_sellers, including Enron, have been_vilified by_the 
politicians and the media.  Here are_the_facts:

? Other than_a small amount of wind power, Enron is not_a generator in the 
state of_California.  Every_megawatt_we_sold in California we_bought in the 
same market available_to other California purchasers.  Because_we are a 
market maker, not a_generator, we are not biased toward_high prices.  We are_
interested only_in having a market that_works so that_we can_package products 
for_our customers.
? As a seller to_end-use markets in_the state, we provided protection from_
the_problems the states,_utilities,_and_their customers,_now face. _We_
protected, and_still_protect, our customers from price volatility.

You_may_have read that EES recently elected to_have the utilities supply_
power_directly to its customers_in California instead of procuring_power on 
the open market. _Early reports_mischaracterized this_as a &turnback8 of our 
customers to the utilities.  Here_are the facts:

? As a result_of a variety of_factors existing_in_the current California_
market,_it made_more sense for EES to source power_for its_customers directly 
from the utilities. _This decision reduced EES,s_market_price risk by 
allowing EES to_access lower utility rates.
? EES did_not terminate any customer contracts,_and_our_customers continue to 
receive the_financial benefits of their contract prices.
?_EES is continuing_to work with its California customers to_provide_them 
with other energy-related products and_services,_including assistance in 
reducing the demand_for_power,_particularly at peak times.

Enron is_currently proposing solutions to help California_work out of its 
crisis; Enron continues to sign_up customers in_the state; and Enron 
continues_to_actively_manage its risks and capture opportunities in Western 
power markets._ Enron