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Feds Find California Power Manipulation
7 minutes ago

By MARK SHERMAN, Associated Press Writer

WASHINGTON - Federal energy regulators said Wednesday that their investigation found widespread manipulation of natural gas and electricity prices and supplies in California.

Pat Wood, chairman of the Federal Energy Regulatory Commission, said that as a result of the manipulation California would receive more than the $1.8 billion in refunds recommended by a FERC judge in December. The exact amount is to be determined in the coming months.

The FERC singled out seven subsidiaries of bankrupt Enron Corp. and five other companies for taking advantage of a dysfunctional market and reaping millions of dollars in unjust profits.

"The price gouging abounded," Commissioner William Massey said. He said he regretted that FERC did not intervene earlier to police the newly deregulated power market in California.

The agency is considering placing limits on the profits of four marketers of wholesale power and banning eight gas companies from selling natural gas in California, Wood said.

The power marketers are Enron Power Marketing Inc., Enron Energy Services Inc., Reliant Energy Services Inc., and BP Energy Company.

The natural gas companies are Bridgeline Gas Marketing LLC, Citrus Trading Corp., ENA Upstream Company, Enron Canada Corp., Enron Compression Services Company, Enron Energy Services Inc., Enron MW LLC and Enron North America Corp.

The investigation also found a close link between natural gas and electricity prices. Gas is the fuel at many power plants.

After a 13-month investigation, FERC concluded "that many trading strategies employed by Enron and other companies violated the anti-gaming provisions" of marketing rules.

"Enron manipulated thinly traded physical markets to profit in financial markets," FERC said, estimating that Enron made more than $500 million in online trading in 2000 and 2001.

FERC investigators recommended that the companies be forced to give up unfairly earned profits.

Investigators also urged the commission to consider sanctions energy companies and public utilities that sold power in California during the summer of 2000. That could further increase the amount of money owed to California since that time period is not accounted for in the refunds that already have been recommended.

Wood said he and his two colleagues also would consider California's request to renegotiate some $20 billion in long-term power contracts signed at the height of the energy crisis. FERC also is continuing to evaluate other evidence the state has submitted to support more allegations that some energy companies withheld power in a bid to increase prices.

FERC planned to make public the California evidence later Wednesday.

The energy crisis cost the state as much as $45 billion over two years in higher electricity costs, lost business due to blackouts and a slowdown in economic growth, according to the Public Policy Institute of California.

Shortcomings in California's energy market rules and a shortage of electricity stemming from the lack of hydropower in the Northwest in 2000 "made this fertile ground for the manipulation we found," said Donald Gelinas, who headed FERC's investigation.

The regulatory agency capped wholesale power prices across the West and instituted other changes in June 2001 that brought a quick end to the energy crisis.

Wood ordered an investigation in February 2002 after California officials repeatedly charged energy marketers with gouging California's utilities and its customers.

Two months later, FERC obtained an internal Enron memo that described trading strategies, including sham transactions and other schemes aimed at creating congestion on the Western power grids and forcing up prices. Two former Enron traders have pleaded guilty to federal charges stemming from the trading strategies.

The memo indicated that other companies had similar strategies, but provided no details. Energy companies have largely denied wrongdoing.

Separately, California last week agreed to a settlement with El Paso Corp., for $1.7 billion, ending a dispute over whether the company withheld natural gas from California to drive up prices.

hstencil, Wednesday, 26 March 2003 18:17 (twenty-three years ago)

New (Fujimori) Answers!

hstencil, Wednesday, 26 March 2003 18:18 (twenty-three years ago)

This reminds me of that Onion sideline..

"School bully not so tough after being molested"

donut bitch (donut), Wednesday, 26 March 2003 18:33 (twenty-three years ago)

DB, I've only got one thing to say to you, "Ew...."

Still, tis good that CA folk are getting royally un-screwed for a change. Mind you, the refund checks may only be for 5 cents instead of $50, if the company has its way.

Nichole Graham (Nichole Graham), Wednesday, 26 March 2003 18:47 (twenty-three years ago)

Haha, I would trust the ability to get a refund under a Gray Davis administration as much as the ability to fist a minnow.

donut bitch (donut), Wednesday, 26 March 2003 18:55 (twenty-three years ago)

You act as if there aren't marrow-fisting mites.

Ned Raggett (Ned), Wednesday, 26 March 2003 18:57 (twenty-three years ago)

Marrow fisting? Ow, go away Leather Ned.

donut bitch (donut), Wednesday, 26 March 2003 19:06 (twenty-three years ago)

Marrows, minnows, it's all fun.

Ned Raggett (Ned), Wednesday, 26 March 2003 19:07 (twenty-three years ago)

There's always blaming hstencil

donut bitch (donut), Wednesday, 26 March 2003 19:07 (twenty-three years ago)

Not if he's smart about it.

Nichole Graham (Nichole Graham), Wednesday, 26 March 2003 19:12 (twenty-three years ago)

In non Iraq news:

Bush pushes through his spending bill and the tax cuts he requested have been cut in half (but its still a pointless tax cut for the rich).

A plane carrying three "American government officials" crashed in Colombia. They were looking for Americans kidnapped by FARC after their plane crashed very close to where they themselves just crashed.

There is unrest in Nigeria, resulting in a drop in oil production - Nigeria is a major producer of oil.


fletrejet, Wednesday, 26 March 2003 19:13 (twenty-three years ago)

And yet more joy abounds.

Nichole Graham (Nichole Graham), Wednesday, 26 March 2003 19:14 (twenty-three years ago)

For Tom Millar - New Housing Sales are down 8.1%.

hstencil, Wednesday, 26 March 2003 19:16 (twenty-three years ago)

The two American pilots who killed 4 Canadians in Afghanastan are going to be allowed to avoid a court marshall, announced shortly after the bombing began.

Mr Noodles (Mr Noodles), Wednesday, 26 March 2003 19:16 (twenty-three years ago)

Can you post a link? That's fucked up.

hstencil, Wednesday, 26 March 2003 19:17 (twenty-three years ago)

North Korea cuts all ties to UN and US.....

http://www.austin360.com/aas/news/ap/ap_story.html/Intl/AP.V0632.AP-Koreas-Nuclear.html

badgerminor (badgerminor), Wednesday, 26 March 2003 19:20 (twenty-three years ago)

How You Can Own a Piece of Iraqi Land:

http://www.weeklyworldnews.com/news/index.cfm?instanceid=57356

nickalicious (nickalicious), Wednesday, 26 March 2003 19:23 (twenty-three years ago)

From CNN even:

India, Pakistan play atomic handball

No Face Disease stalks Chihiro

Matador band smacks Peruvian ass
Tobacco Farmer Mentalist

donut bitch (donut), Wednesday, 26 March 2003 19:24 (twenty-three years ago)

(*drum fill* thank you, i'll be here all week)

donut bitch (donut), Wednesday, 26 March 2003 19:25 (twenty-three years ago)

two weeks ago the Prime Minister of Serbia was murdered. i did not notice any major news story about this.

stevem (blueski), Wednesday, 26 March 2003 19:25 (twenty-three years ago)

Thanks Noodles.

hstencil, Wednesday, 26 March 2003 19:43 (twenty-three years ago)

an old woman in new zealand was beaten to death by frozen dog roll - these things usually make headlines here and have an entire 1/2 hour of prime time devoted to picking around talking to people who may have known the victim etc.

a friend handed me a pamphlet that predicts major aggression towards palestinians while all cameras are pointed at iraq. it was scary and possibly scare-mongering stuff, replete with racist and violent quotes from every major israeli leader for the last 100 years.

Clare (not entirely unhappy), Wednesday, 26 March 2003 19:45 (twenty-three years ago)

The world will run out of drinkable water in five minutes.

Rockist Scientist, Wednesday, 26 March 2003 19:46 (twenty-three years ago)

In not-so-bleak news...

McDonald's must give $10,000,000 to various vegetarian, Hindu, kosher, and children's charities

donut bitch (donut), Wednesday, 26 March 2003 19:51 (twenty-three years ago)

Well, I’ve been getting scary e-mail updates from colleagues in Bangui (Central African Republic) regarding the coup.

I have family living in Bulawayo (Zimbabwe) and I have no fuckin’ idea what is going on with them. Don't know if internet is off, phone lines in Zim are generally fucked anyway, but it really upsets me that this has completely dropped off radar – BBC had a story today for the first time in days and it just reinforces how little accurate coverage Africa gets

(also annoyed from seeing Robert Kaplan’s latest Atlantic Monthly story where he practically beatifies leader of Eritrea in opposition to all fact)

I’ve become so cynical about publications I used to somewhat somewhat trust. The amount of bias and inaccuracy I see has made me understand why ppl ignore news period, and why ppl abroad hate western media. I am depressed.

H (Heruy), Wednesday, 26 March 2003 22:51 (twenty-three years ago)

Hmmm...how about this new-fangled flu/pneumonia that seems to be spreading through south-east asia at an alarming rate? And the death of Moniyahan? And the assassination of the Serbian PM? And the weather? And West Nile Virus fears?

I'm Passing Open Windows (Ms Laura), Wednesday, 26 March 2003 23:41 (twenty-three years ago)

I don't quite get the whole idea that the Serbian PM assassination was ignored, but then again I am operating via a specific bias -- my main straight up news source is the BBC website, and they ran it as a lead story for two days.

Ned Raggett (Ned), Wednesday, 26 March 2003 23:42 (twenty-three years ago)

AH - yes, the BBC covered it, as did the CBC. But CNN seemed to glogg (I think that was supposed to be "gloss" but I really like how I originally typed it) things over, and I've not seen any serious discussion of the implications of the assassination and the aftermath. Well, I have *read* some coverage in the Washington Post and NYT, but not watched coverage on the American news stations.

I'm Passing Open Windows (Ms Laura), Wednesday, 26 March 2003 23:48 (twenty-three years ago)

well the Serbian PM assassination passed me by completely, but i dont always read a paper every day or go to news sites everday - but if i do then the bbc is first choice. i guess its just laziness on my part all along...

stevem (blueski), Thursday, 27 March 2003 00:15 (twenty-three years ago)

meanwhile whats Mugabe up to lately?

stevem (blueski), Thursday, 27 March 2003 00:16 (twenty-three years ago)

I think he's up to 19 ft, 10 in. Six more inches and he'll have the pole vault world record!

Dan Perry (Dan Perry), Thursday, 27 March 2003 00:23 (twenty-three years ago)

And this isn't getting too much coverage (except in Ireland where we are quite fanatical about the religious orders):

http://www.cnn.com/2003/US/South/03/26/nuns.abducted/index.html

Lara (Lara), Thursday, 27 March 2003 10:12 (twenty-three years ago)

Sister Philomena Fogarty - brilliant name! Best religious bod's name in the news since the Right Reverend Roderick Wright.

MarkH (MarkH), Thursday, 27 March 2003 10:18 (twenty-three years ago)

what about ArchBishop Runcy?

stevem (blueski), Thursday, 27 March 2003 10:27 (twenty-three years ago)

Revive with this:

April 3, 2003
Claims for Jobless Benefits Are Highest Since April 2002
By THE ASSOCIATED PRESS

Filed at 5:02 p.m. ET

WASHINGTON (AP) -- The number of American workers filing new claims for unemployment benefits climbed last week to the highest point in nearly a year as businesses trimmed jobs in the muddled wartime economic climate.

The Labor Department reported Thursday that new applications for jobless benefits jumped by a seasonally adjusted 38,000 to 445,000 for the week ending March 29 -- a level last reached in the week ending April 13, 2002.

``It is the pall of the Iraqi war, higher energy prices and lower stock prices just weighing on the willingness of companies to maintain jobs,'' said Mark Zandi, chief economist at Economy.com. ``The uncertainty is so high they just can't think about expanding their businesses at this point.''

A second report offered more unsettling news: Activity in the service sector -- normally the engine of job creation in the United States -- contracted in March, ending 13 months of growth.

The Institute for Supply Management reported that its nonmanufacturing index sank to 47.9 in March, from a reading of 53.9 in February. An index reading below 50 means activity contracted; a reading above 50 signifies growth.

``It is clear that the war is having a negative impact on most sectors of the economy,'' said Maury Harris, chief economist at UBS Warburg.

The institute reported this week that manufacturing activity shrank in March, raising fears the economy may be headed for a new recession.

On Wall Street, the disappointing economic news helped push stocks lower. The Dow Jones industrial average lost 44.68 points to close at 8,240.38.

In the jobless claims report, the pace of layoffs was worse than economists were predicting. They were forecasting claims to rise to around 410,000.

Economists say claims above the 400,000 mark generally show an extremely weak job market.

The more stable four-week moving average of new claims rose last week to 426,250. The moving average has been above the 400,000 level for five weeks in a row.

Lackluster profits and uncertainties surrounding the war are some of the factors behind the increasing layoffs. Those same factors also are making companies reluctant to invest heavily in capital projects, further restraining the economy.

After falling into a recession in 2001, the economy has struggled to return to firm footing. It has been a bumpy road to recovery, with three months of economic strength followed by three months of weakness.

With economists predicting subpar growth for both the first and second quarters of this year, the labor market is likely to deteriorate further, the economists say.

The unemployment rate rose to 5.8 percent in February. Economists believe it could move to 5.9 percent or 6 percent for March, and higher in the months ahead. The government reports on the employment situation for March on Friday.

Economists believe the economy lost 40,000 jobs in March alone -- not good news but not as bad as the situation in February, when payrolls fell by 308,000.

To energize the economy and help job creation, President Bush has called on Congress to enact a fresh round of tax cuts.

``Today's bad news makes it even more important for Congress to act and pass the president's proposal,'' said White House spokesman Ari Fleischer.

Treasury Secretary John Snow, in Florida Thursday trying to sell the plan, seconded that notion. Snow offered his own take on the jump in jobless claims. ``I think it's less uncertainty about the war than it is simply some underlying weakness in the economy as a whole,'' he said.

Federal Reserve policy-makers have kept interest rates at very low levels, with the hope that might help cushion the fallout from the ailing job market, a turbulent stock market, higher energy prices and war worries.

A big fear is that a worsening labor market will make consumers, essential to economic activity, more cautious.

The number of workers continuing to draw unemployment benefits soared by 107,000 to 3.61 million for the work week ending March 22, the most recent period for which that information is available.

Continuing benefits were at their highest point since Nov. 16, 2002.

^------

On the Net: Jobless report: http://www.doleta.gov

Institute for Supply Management: http://www.ism.ws/

hstencil, Thursday, 3 April 2003 20:35 (twenty-three years ago)

George Bush's head being waved on a stick by Eddie Vedder.

N. (nickdastoor), Thursday, 3 April 2003 20:38 (twenty-three years ago)

http://www.newyorker.com/talk/content/?030407ta_talk_hertzberg

James Blount (James Blount), Thursday, 3 April 2003 23:35 (twenty-three years ago)

Thank you James Blount. I was just about to post that.

Mary (Mary), Friday, 4 April 2003 01:19 (twenty-three years ago)


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