Agency pulls Enron trading papers
FERC begins to rule on fallout from Western energy crisis of 2000-01
In its first-ever use of the so-called utility death penalty, the Federal Energy Regulatory Commission has banned bankrupt Enron Corp. from selling electricity and natural gas at market-based rates.
Enron, which is in the process of selling Portland General Electric, no longer has an active trading operation, and the order will prevent the firm from restarting it. PGE operates a separate trading unit and will not be impacted by the decision, said spokesman Kregg Arntson.
The Wednesday decision came on the same day the agency rejected refund requests by a dozen energy companies, including PacifiCorp, for wholesale energy contracts signed during the California energy crisis of 2000-01.
PacifiCorp spokesman Dave Kvamme said it will seek a rehearing on the case.
'We're confident we can make a persuasive case,' he said. 'We're disappointed FERC did not grant relief on high-priced contracts when it's clear that our customers were harmed by this. Clearly the company and customers were damaged by dysfunctional markets.'
The contracts were signed during the West Coast energy crisis of 2000 and 2001 a shortage investigators now think may have been caused at least in part by market manipulation.
At the same time, FERC ordered 60 power companies to produce more information on questionable trading practices during the Western power crisis. The state's two largest investor-owned companies, PacifiCorp and PGE, were cited in the order, as well as government-owned Bonneville Power Administration and the Eugene Water and Electric Board.
If any of the entities engaged in deceptive trading practices, such as the trading schemes revealed by Enron traders, they would be required to refund all profits made during that time period, Jan. 1, 2000, to June 20, 2002.
PGE maintains the position that it did not participate in deceptive trading policies, Arntson said.
'We've been cooperating all along with the commission as it has gone through the investigation, and we will continue to fully cooperate with them,' PacifiCorp's Kvamme said. 'We spent over a billion dollars to buy power to keep customers' lights on.'