Laughing so hard it hurts!
Death Star Strategy May Have Been Widespread
The ISO's report shows that 21 companies and utilities may have reaped $14.4 million in revenue by using trading tactics similar to Enron's "Death Star" strategy. The strategy involved collecting payment from the ISO for relieving congestion on transmission lines when in fact no power was moved.
The companies which may have reaped the most benefit from such a strategy were Royal Dutch/Shell (RD) unit Coral Power at $3.9 million; Sempra (SRE) at $1.6 million; British Columbia Power Exchange at $1.08 million; and Williams Companies (WMB) at $966,283, the report said.
The report cautions, however, that while ISO data indicates Enron-like strategies may have been employed by these companies, the evidence is not conclusive.
"To make a determination of intent, you need to take our information and look at it in parallel with a variety of agencies' information. We are the fingerprint expert at what might be a crime scene, so we pick up evidence and then the agencies have to weigh it with other forensic evidence to determine what happened," Fishman said.
Companies Deny Using Enron Tactics
Spokesmen for several companies denied they had engaged in Enron-type trading strategies.
"We have conducted a comprehensive review of our trading activities for FERC and did not find that Coral manipulated the market or engaged in inappropriate business activity," said Coral spokesman Jimmy Fox.
Sempra spokesman Doug Kline said his company's internal investigation also failed to unearth evidence of wrongdoing.
"We've found nothing that indicates our conduct is inconsistent with ISO rules or had any effect on energy supply or power prices," Kline said.
The ISO sent a copy of the report to the U.S. Attorney's Office in San Francisco, California's attorney general, a state Senate panel, the state Public Utilities Commission and the state Electricity Oversight Board, Fishman said. The report was kept confidential until Monday in order to give investigatory agencies time to digest it, Fishman said.
A California Senate committee that is investigating energy market manipulation will query the ISO about the report at a hearing Jan. 14, said Christian Schreiber, an investigator for the committee chaired by Sen. Joe Dunn, D-Santa Ana.
"These findings are the tip of the iceberg. Even if they don't account for the bulk of the profits, the fact that this behavior could occur is suggestive of the greater dysfunction in the market," Schreiber said. -By Jessica Berthold, Dow Jones Newswires; 323-658-3872; jessica.berthold@dowjones.com
Updated January 7, 2003 9:36 p.m. EST |
