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Alleged Peoples Gas, Enron deal probed

CHICAGO, Jan. 30 (UPI) -- An investigation was under way in Chicago into whether Peoples Gas conspired with Enron in a complex ruse to push up home heating prices.

The focus is on a series of transactions in which Peoples Gas transferred or sold natural gas intended to heat Chicagoans' homes to a venture of Peoples Energy Corp., its parent company, and Enron, internal documents show.

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As a result, the utility was forced to replenish gas supplies at high prices on the open market, contributing to record heating bills for customers during the brutally cold winter of 2000-2001, the Chicago Tribune reported Friday.

If the rate-setting Illinois Commerce Commission determines Peoples Gas made such deals without its permission, the company could face penalties for violating the Illinois Public Utilities Act.

In a written statement, Peoples Gas said that its gas purchases were "prudent and did not harm customers" and defended its gas transactions.

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