CPUC FIling -- Enron not mentioned in "cartel"

Sue Mara
Enron Corp.
Tel: (415) 782-7802
Fax:(415) 782-7854
----- Forwarded by Susan J Mara/NA/Enron on 03/07/2001 09:37 AM -----

=09"Daniel Douglass" <Douglass@ArterHadden.com<
=0903/07/2001 08:40 AM
=09=09=20
=09=09 To: <Barbara_Klemstine@apsc.com<, <Bob_Anderson@apses.com<,=20
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<gavaughn@duke-energy.com<, <rjhickok@duke-energy.com<, <gtbl@dynegy.com<,=
=20
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<rllamkin@seiworldwide.com<
=09=09 cc: <Ken.E.Randolph@dynegy.com<
=09=09 Subject: Important Filing - Read This

Attached is a document that WPTF members should read right away.? It is a=
=20
motion which?was filed by Michael Aguirre, supposedly on behalf of UCAN=20
(although UCAN is mentioned only in the cover letter and nowhere in the =20
document itself).? It requests hearings by the Commission to determine the =
=20
following:
?
"(1) the cause of the unjust and unreasonable prices being charged for =20
electricity in California; (2) the utilities efforts to pursue lawsuits=20
against generators or marketers of electricity and natural gas."
?
The motion?further describes the following scenario which it claims =20
justifies these hearings:
?
"Five companies operating out of Houston, Atlanta and Tulsa have controlled=
=20
the power to set prices of electricity in California.? These companies are:=
=20

(1) ?Williams Energy Services and Williams Gas Pipeline Company and their=
=20
subsidiaries, which operate out of Tulsa, Oklahoma and control the =20
electricity generation in Orange County ("Williams");=20

(2) ?Southern Company Energy and Marketing, Southern Energy California, an=
d=20
their affiliated companies, which operate out of Atlanta and control=20
electricity generation in parts of the San Francisco Bay Area consisting o=
f=20
Contra Costa, Pittsburg, and Potrero ("Southern");=20

(3) ?Reliant Energy Services, Reliant Energy Power Generation and their=20
affiliated companies, which operate out of Houston and control electricity =
=20
generation in parts of Los Angeles County, Ventura County, and San Bernadin=
o =20
County, consisting of Cool Water, Etiwanda, Ellwood, Mandalay and Ormond=20
Beach ("Reliant");=20

?(4) ?Duke Energy North America and Duke Trading & Marketing and their=20
affiliated companies, which control electricity generation in parts of the=
=20
San Francisco Bay area, the Central Coast, and Ventura and San Diego=20
counties, consisting of Oakland, Morro Bay, Moss Landing, and South Bay Sa=
n=20
Diego ("Duke"); and=20

(5) ?Dynergy Marketing and Trading and its affiliated companies, which=20
control electricity in parts of North County San Diego ("Dynergy").? These=
=20
companies will collectively be referred to as the "WSRD Cartel."

The members of the WSRD Cartel are each following the same fatally flawed=
=20
business plan, and each knows the others are following the same business =
=20
plan.? The key defect in WSRD Cartel=01,s business plan is the impossibilit=
y of=20
raising and lowering the price at which electricity is sold.? In order to=
=20
push through deregulation of electricity in 25 states, the WSRD Cartel has =
=20
lobbied state officials and the public with claims that they intended to us=
e =20
deregulated electricity rates to lower the prices consumers and businesses=
=20
were paying for electricity.? However, to raise capital from America=01,s=
=20
capital markets, the WSRD Cartel members have represented they would be=20
using deregulated generation to raise the prices consumers and businesses=
=20
were to pay for electricity.? (The "Fatal Flaw" in WSRD=01,s Business Plan=
.)

California=01,s rate payers and utilities are the most recent victims the =
Fatal=20
Flaw in WSRD Cartel=01,s Business Plan.? Members of the WSRD Cartel, along=
with=20
its other allies in the power and natural gas business, successfully lobbi=
ed=20
California to deregulate electricity.? In 1996, California adopted =20
deregulation and thereafter California utiltiies sold off its control of th=
e=20
gas driven electricity generation to the WSRD Cartel.=20
The members of the WSRD Cartel have collusively and unlawfully used their=
=20
control of the generation units in California=01,s to unlawfully raise the=
cost=20
of electricity to unconscionable levels, to amounts greater than four time=
s=20
the amount electricity sold for before deregulation. The WSRD Cartel has=
=20
used systematic unlawful, fraudulent and unfair business practices to rais=
e=20
the prices to their current excessive levels.?=20

The WSRD Cartel has withheld electricity from the market in order to drive=
=20
up prices. The WSRD Cartel has used its position of control over natural g=
as=20
to unlawfully and fraudulently inflate electricity prices by increasing the=
=20
costs natural gas used to generate electricity.? The WSRD Cartel members =
=20
have engaged in collusive practices aimed at shifting large volumes of =20
electricity out of the forward markets and into the real time markets in=20
order to drive up prices.? The WSRD Cartel members have under bid into the=
=20
replacement and other ancillary services markets in order to circumvent the=
=20
price caps and to create out of market calls which resulted in exorbitant=
=20
and unconscionable prices for electricity."
As mentioned above, UCAN is mentioned in the cover letter but not named in =
=20
the filing.? I have written to Michael Shames to confirm whether or not =20
Aguirre was authorized to file this on UCAN's behalf.
?
Dan
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Date: Tue, 6 Mar 2001 18:06:21 EST
Subject: Request for Hearing - for filing - WordPerfect
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To: ?All Parties - A.00-11-038, et al.=20

FROM: ?Michael J. Aguirre, Attorney for UCAN and Ratepayers=20

UCAN AND RATEPAYERS' REQUEST FOR HEARING - WORDPERFECT FORMAT=20

Please respond to Julesan@aol.com (Michael Aguirre) with any questions or =
=20
comments.=20

- REQHRNGEMAIL.wpd