Event-by-event fluctuations of the net charge in local regions of phase space have been proposed as a probe of the QGP state [17,18]. In section 3.1 below the physics motivation behind this idea is presented, along with some derivations and predictions. Simulations of some factors influencing the magnitude of the fluctuations are described in section 3.2, and finally, in section 3.3 the analysis of PHENIX data from the first year of data taking is presented (paper II).