NEM will convene a meeting to start the drafting of a Master Margin and Netting Agreement. The first NEM meeting on a Master Margin and Netting Agreement will take place by conference call on March 27, 2002,at 2PM.(The Meeting in Houston for March 29 has been cancelled as it is Good Friday.) The bridge number for the conference is 703-788-0600, and the passcode is 209353. Chris Bernard from Entergy-Koch has offered to coordinate this effort. Given the various agreements currently in use, the Enron collapse underscores the importance of standardizing margin and netting requirements to avoid future credit crunches in the energy wholesale marketplace. Maximum participation is encouraged. Those interested in participating should call NEM headquarters at 202-333-3288 or Chris Bernard at 713-544-5433 or email us at info@energymarketers.com. A draft document will be circulated to those who are interested before the meeting.

EEI will conduct a meeting on this topic on April 11, 2002, and NEM and its members will also be present for this meeting.

Senators, FERC, PUC and FTC Commissioners have confirmed for NEM's Annual Membership Meeting and National Restructuring Conference to be held June 20 and 21, 2002, at the Marriott Metro Center in Washington, DC. An updated agenda, registration form and electronic brochure is hotlinked here for your convenience.

NEM's Risk Valuation, Management and Financial Accountability Taskforce will hold a one day meeting at the Georgetown Club in Washington, DC on April 18, 2002, beginning at 11AM and lasting no later than 5:30PM. The purpose of the meeting is to forge consensus on accounting and disclosure standards to promote the proper valuation of energy assets, equity securities and forward energy contracts, including derivatives.

Maximum industry participation is encouraged. Those planning to attend the meeting should respond ASAP to info@energymarketers.com.

The NAESB Board of Directors accepted both the Retail Electric Quadrant (REQ) and the Retail Gas Quadrant (RGQ) governance procedures for the purpose of REQ and RGQ joining NAESB on March 7, 2002. Future plans include: 1) finishing segment procedures for each of the 4 segments for the REQ and the RGQ; 2) recruiting 40 Members to file applications to join the REQ and 40 Members to file applications to join the RGQ by May 7, 2002; 3) having at least 5 Members who have filed applications to join the REQ and the RGQ declare membership in each of 4 segments of the REQ and the RGQ by May 7, 2002; 4) holding elections for both the REQ and RGQ Board of Directors and Executive Committee Members by the end of May 2002; 5) having new REQ and RGQ EC Members attend the first NAESB EC Meeting in Seattle, Washington at Boeing Company on June 13-14, 2002; and 6) having new REQ and RGQ Board of Directors attend the first NAESB Board Meeting in Seattle, Washington at Boeing Company on June 28, 2002.

The draft Segment Procedures provide that the supplier segment of the REQ be comprised of "persons engaged in the competitive sale of electricity to end users." The draft Segment Procedures provide that the supplier segment of the RGQ be comprised of, "persons engaged in the competitive retail sale of natural gas and/or capacity, including marketers, aggregators, producers, asset managers and pipelines." The draft REQ and RGQ Supplier Segment Procedures both provide that a, "trade association may join the Supplier Segment as a Voting Member; provided the members of the trade association are under-represented in the Supplier Segment. Only the Supplier Segment Membership may determine if a trade association’s members are under-represented as Voting Members in the Supplier Segment." Those interested in joining should complete a Membership Application and Revocable Proxy available at www.gisb.org/naesb.htm.

With respect to the Wholesale Gas Quadrant, the annual plan includes finishing the development of the contract for purchases and sales of gas, constructing an electronic contract for the base contract for purchase and sales of natural gas, modification of the Funds Transfer Agreement as necessary, developing XML technical implementation for the base contract, determining if an "energy day" standard is needed, determining if a standard transportation services agreement is needed, and determining if a model financial hedging agreement is possible.

Staff gave a presentation at this week's agenda meeting on the upcoming, "Working Paper on Standardized Transmission Services and Wholesale Electric Market Design." The Working Paper will set forth the policy framework for the standard market design "Giga-NOPR." It will discuss an updated single transmission tariff, new transmission service for all customers utilizing locational marginal pricing for congestion management, day-ahead, real-time, and operating reserves markets and the role of the market monitoring unit. The Working Paper will not address scope and governance issues. Comments on the Working Paper will be due March 27, 2002. The full text of Staff's Presentation is available on the NEM Website. The full text of the Working Paper will be posted on the NEM Website when made available electronically.

NEM filed comments on the Joint Filing on a wholesale electric standards board. NEM argued that the industry needs an integrated one-stop shop for commercial and reliability standards, not the proposed "coordination" of NAESB and NERC activities recommended in the Joint Filing. NEM argued that the "coordinated" yet bifurcated approach of the Joint Filing, subject to the jurisdictional uncertainties of NAESB and NERC, will be extremely slow, costly and potentially counterproductive. NEM recommended that FERC either select one organization or process to establish both reliability and commercial standards or institute its own procedures and propose standards subject to sixty days notice and comment. NEM argued that either of these methods would allow industry participants to better allocate their time and resources. The full text of NEM's Comments is available on the NEM Website.