SACRAMENTO, Jan. 31 (UPI) -- California Thursday asked federal energy regulators to look into Enron's marketing activities in the state in order to prove suspicions the toppled energy giant manipulated electricity prices during last winter's power crisis.
Gov. Gray Davis sent a letter to the Federal Energy Regulatory Commission Thursday in which he told the regulators that new "revelations" about possible market manipulation had come out in the Enron post-mortem investigation.
"I am extremely concerned about revelations made in the past few days concerning possible manipulation of energy prices by Enron Corporation," Davis said in a letter to FERC Chairman Patrick Wood. "California has a special interest in getting to the bottom of such charges, since this state bore the brunt of the marketers' price gouging."
Davis has long and vociferously alleged that Enron and other energy companies conspired to influence the volatile wholesale electricity market by not offering power for sale until a looming shortfall pushed the spot price to high levels. Davis was blunt when asked about Enron Wednesday in a telephone interview broadcast live on San Francisco radio station KGO.
"No question we got screwed by these people in the spring," Davis said. "They charged the utilities $7 billion for power in 1999, and then they charged them $27 billion the next year when the utilities were buying the power. We (the state government) got it for a little bit less the following year, but there is no question they overpriced these electrons. You can't add value to an electron; an electron is an electron."
State officials say Enron has repeatedly refused to hand over documents subpoenaed by the state attorney general and legislature that would help prove the accusations. Enron has said it already handed over all relevant documents and also has contested California's authority to subpoena them in the first place.
The power to regulate wholesale electricity prices rests with FERC, and Davis last summer asked the agency to investigate and to refund nearly $9 billion the state contends it was overcharged by the energy sellers. FERC has been largely reluctant to take any action to cap wholesale prices, saying it preferred to let the market sort itself out and not take any action that might prevent new power plants from being built.
"If there is any doubt in your mind about whether an investigation is warranted, the latest revelations should answer that question," Davis wrote. "Clearly, an investigation is needed."
California's move to bring federal pressure to bear against Enron also resulted Monday in a call by California's two senators, Barbara Boxer and Dianne Feinstein, for an investigation by the Senate Energy Committee into the allegations.
"Everybody is falling over each other to pick away at Enron," Enron's Washington attorney, Robert Bennett, told the Los Angeles Times this week. "I do not question the legitimacy and right of Congress to make inquiry, but I think they should complete their investigations before they complete their conclusions."
(Reported by Hil Anderson, UPI Chief Energy Correspondent)
