In reference to your May 15 article, "Report Finds Problems With Choice Pilot" ("Headlines," p. 16), following is the industrial customers' response to the report.

STATEMENT

On May 7, 1997, a group of large industrial consumers of electricity on the Illinois Power Co. system, referred to as the Illinois Industrial Energy Consumers, filed a response to a recently submitted report by Illinois Power Co., pertaining to the Direct Energy Access (DEAS) report. The DEAS, approved by the Illinois Commerce Commission on March 15, 1996, is an experimental retail wheeling program available to large industrial customers of Illinois Power Co. IP was required by the Illinois Commerce Commission to submit a periodic report, and did so nine months into the experiment.

IP's characterization as to the success of the report was less than glowing, and at odds with the opinion of a majority of the participants in the DEAS experiment. The IIEC was compelled to respond to what they termed "IP's varying characterization as to the success of the DEAS program, and of lessons learned."

In its response, the IIEC group indicated it had encountered few problems thus far, and any glitches have been minor in nature and addressed with a fair amount of administrative ease, and without disruption to IP's system, or to any customer. The IIEC group argued, relying upon IP's numerical perspective to measure the success of the DEAS program that, in fact, the transactions were shown to be 99.98 percent perfect. IIEC concluded that when one conceives of the many times customers remained on their primary transmission path, did not lose their source of power, and did not incur energy imbalance charges, it is apparent the DEAS program was quite successful.

IIEC completely disagreed with IP's statement that the principle lesson learned to date is a need for caution in implementing open access on a large scale. IIEC concludes just the opposite. The success of the DEAS program is further proof that large industrial customers already have the necessary knowledge and background to procure energy services in a direct access market. The DEAS program has shown to be a valuable tool in the eventual implementation of direct access for all customers.

As proven by the above statement, contrary to the tone of the IP report filed with the ICC, there were minuscule problems with the DEAS retail wheeling pilot.

Martin A. Suhoza, Director, Energy Management & Production Materials

LTV Steel Co. Inc.

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