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Date: Tue, 5 Dec 2000 10:44:00 -0800 (PST)
From: lisa.sawyer@enron.com
To: stephen.horn@enron.com, jenny.rub@enron.com, john.pavetto@enron.com, 
	beth.perlman@enron.com, dan.bruce@enron.com, allan.sommer@enron.com, 
	andrew.parsons@enron.com, mark.pickering@enron.com, 
	mike.harris@enron.com, philippe.bibi@enron.com, sally.beck@enron.com
Subject: ETS Risk System Findings
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	lee.ferrell@enron.com, vernon.mercaldo@enron.com, 
	steve.hotte@enron.com, dave.neubauer@enron.com, 
	kent.miller@enron.com
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The following is a summary of our findings for selecting a Risk System for 
the ETS Marketing Department.  Meetings were held with Richard Burchfield, 
Stephen Stock and Steve Nat to review the TAGG, ERMS and EnPower systems as 
possible alternatives for a risk system for ETS.  Lee Ferrell and Vernon 
Mercaldo represented the ETS commerical group.   In summary,  ETS is looking 
for a risk system that is fully integrated from Deal Capture to Billing and 
can be implemented in the 30-60 day timeframe.  They are anticipating maximum 
concurrent users of about 10 with approximately 20 deals per month.  Overall, 
it looks like the Caminus package offers ETS a faster and smoother 
implementation, does not expose us to any market affiliate violations or 
suspicions and is reasonably affordable with an estimated on-going 
maintenance costs of less than $100,000/year.  The following provides more 
details and I have attached a functional comparison.  Please let me know if 
you have any questions or further followup that I need to address.  Thanks.

Summary of Findings
Based on our discussion with Richard Burchfield and Stephen Stock, we 
rejected the possibility of using TAGG and ERMS because these applications 
are not able to handle spread options (one of the key ETS requirements).   
Richard suggested we take a look at EnPower.  This system was considered a 
closer fit and also more portable.  After closer inspection,  the EnPower 
System is not currently a  fully integrated product.  There are plans to 
integrate several of components into the product, but at this time, the 
system has interfaces to several other external applications including the 
following:

 RAC for Risk Management
 DECAF for deal confirmations
 PORTCALC/TAGG/ERMS for loading price curves and price calculations
 UNIFY for billing
 Desktop Models for Settlement
 Global Counterparty for Trading Partner and Credit

All of the above applications would have to be certified by an outside party 
to make sure that we could protect all parties regarding Market Affiliates.  
This would entail evaluating each system's current security, testing and 
possibly requiring changes to meet security requirements.  This process could 
take a significant amount of time to complete and might still constitute a 
violation of the marketing affiliate rules or would at minimum create the 
appearance of marketing affiliate violations.  We discussed this alternative 
with Drew Fossum, NNG Legal Counsel, and Drew is in concurrence with this 
opinion.  

Regarding costs, the IT team did not attempt to estimate an on-going support 
costs figure since there would be several factors to consider.  Additionally, 
there is a concern regarding how the Pipelines would achieve priority on 
getting their production problems and enhancements addressed considering the 
current demands on IT resources.    

Functional Comparison Matrix