Friday, July 23, 2004

The Tortoise and the Federal Energy Regulatory Commission 

Today's hot tip: bet on the tortoise. Still, after all these years, it's nice to see two mildly encouraging Enron stories, even though both are sure to be lost in the general hullabaloo surrounding the release of the 9/11 report. Story #1, from the S.F. Chronicle:
Federal energy regulators ordered Enron on Thursday to give back more than $32 million in "unjust'' power profits in a ruling that could lead to much broader findings that the disgraced energy giant unfairly gamed West Coast electricity markets for six years.

Concluding that Enron secretly conspired with another Texas electricity company, the Federal Energy Regulatory Commission ruled that Enron broke market rules by hiding its business relationship with a supposed competitor. The commission also ordered an administrative law judge to review all of Enron's dealings in the West between 1997 and 2003 to determine if the company should be forced to refund all of its profit during the period, which includes the California energy crisis . . . .

"Enron potentially could be required to disgorge profits for all of its wholesale power sales in the Western Interconnect,'' according to the commission.

That could range between $125 million and $2.97 billion, the commission noted in its order.

"It's really nice to see FERC leaping into action three years after California's ratepayers were taken to the cleaners,'' said state Sen. Debra Bowen, D-Marina del Rey (Los Angeles County), chairwoman of the Senate's lead energy committee.

"Where was FERC in 2000, 2001 and 2002, when its refusal to enforce the Federal Power Act and blow the whistle on these guys let Enron and other power companies siphon $9 billion out of California?"
And Story #2, from the Houston Chronicle:
In response to a recent U.S. Supreme Court case that put federal sentencing procedures in chaos, prosecutors re-indicted defendants in two Enron criminal cases, adding allegations that could expose them to longer prison terms.

The Enron grand jury this week reindicted both the six people accused in a Nigerian barge case scheduled for trial in August and the seven ex-Enron executives charged in the Internet broadband division case scheduled for trial in October.

Included in both new indictments are allegations that each scheme caused the loss of more than $80 million, an allegation that under the federal sentencing guidelines can add years to a sentence.

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