Exhibit 99.395


                             STAKEHOLDER WHITE PAPER
        POSITION: ALL AVAILABLE FTRS SHOULD BE RELEASED IN THE FIRST YEAR


1.   Until FTRs are issued for all available capacity under the CAISO's control,
     service through the California System (e.g. NW to SW or SW to NW) is
     inferior to the point-to-point service which would have been provided under
     FERC Order No. 888. Until the FTRs are issued to provide price certainty,
     the equivalent of firm point-to-point transmission service is unavailable
     from CAISO. An FTR phase-in will perpetuate inferior service for several
     years.

2.   The release of all available FTRs will create a larger, more fluid market
     in FTRs. The primary auctions and secondary markets won't attract much
     interest unless there is sufficient volume to make it worthwhile to bid.
     The amount of rights on many paths is already small, so releasing only a
     part of those FTRs will not produce a block of capacity large enough to
     make bidding on them meaningful.

3.   There will be little cost increase to run an auction that releases all of
     the rights as compared to some of the rights. If there is a worry about the
     mechanics of the auction, then run two primary auctions the first year,
     about a week apart in the Fall of 1998, with each selling 50% of the
     available rights.

4.   There are already a large number of phase-ins associated with moving to
     competition: CTC, direct access, billing and metering unbundling, and
     divestiture. Another phase-in only serves to slow down the move to
     competition and reduce interest in the market.

5.   If only a portion of the FTRs are released, the prices will not provide
     meaningful guidance to the prices which will be obtained when all FTRs are
     released to auction. With the proposed multi-round auction, a market
     clearing price will be obtained for the FTRs released, i.e. the maximum
     price at which all the FTRs offered can be sold. Not all auction
     participants will place the same value on the FTRs. If only 1/3 of the FTRs
     are released, the clearing price to sell that 1/3 will be based on the bids
     of the participants at the high end of the value scale. This price will
     tell nothing about the clearing price which would be obtained if all FTRs
     were released. In order to sell the other 2/3's of the FTRs, the bids of
     those a lower threshold value will enter into setting the market clearing
     price.

6.   Proponents of an FTR phase-in have argued the phase-in is necessary to
     avoid an undervaluing of the FTRs in the first year auction with a penalty
     to the owners by the CPUC for failing to get full value from the FTRs. The
     position limits competition and does not hold up when examined carefully.

     -    It is every bit as likely, and perhaps more so, that the FTRs will be
          overvalued in the first year auction, because the desire for cost
          certainty will be higher when there is less information about the
          level of congestion cost.

     -    Even if the FTRs were undervalued, the decision to release the FTRs is
          a decision to be made CAISO with the approval from FERC. As a result
          the revenues obtained will be outside the discretionary control of the
          owners. The owners have exercised diligence in protecting their
          customers by advancing this issue. A disallowance or penalties of a
          cost outside an owners control would be unusual. It would be the
          equivalent of disallowing taxes.

     -    The congestion revenues will be small compared to the total revenue
          requirement of the owners, so the effect of a low market valuation of
          FTRs will be even smaller.

     -    Finally, the owners can bid for the FTRs on the same basis as all
          users - everyone will face the same degree of uncertainty.

7    If a limit on release is imposed then make it a percentage of the total
     transfer capability available capacity including unconverted rights. It
     would be useful to have the ISO prepare an estimate of the MW of rights to
     be auctioned on each interface so that the ISO Board can better assess the
     impact of its decision.

8    The congestion revenues will be allocated in any event. It is better to
     have this allocation done via a market mechanism and reduce the allocation
     via arbitrary pro-rata rules.