Message-ID: <22268638.1075848059937.JavaMail.evans@thyme> Date: Fri, 15 Dec 2000 07:33:00 -0800 (PST) From: richard.sanders@enron.com To: steven.kean@enron.com, mark.palmer@enron.com Subject: Request to DOJ Investigation to Undertake CA Investigation Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Richard B Sanders X-To: Steven J Kean, Mark S Palmer X-cc: X-bcc: X-Folder: \Steven_Kean_June2001_3\Notes Folders\California X-Origin: KEAN-S X-FileName: skean.nsf ----- Forwarded by Richard B Sanders/HOU/ECT on 12/15/2000 03:36 PM ----- "JOHN G KLAUBERG" 12/15/2000 03:07 PM To: Mark.E.Haedicke@enron.com, Mike_D_Smith@enron.com, Richard.B.Sanders@enron.com, vsharp@enron.com cc: Subject: Request to DOJ Investigation to Undertake CA Investigation FYI re: DOJ/CA Situation. I'm not sure what to make of this in light of the upcoming change in the Administration, but I thought you would want to be aware of it. Also, although the focus appears to be generators, I would assume that if DOJ elected to go forward andy investigation would be likely to expand to include major marketers. John Friday December 15, 1:03 pm Eastern Time Justice Dept Asked to Probe Power Crisis WASHINGTON (Reuters) - U.S. Attorney General Janet Reno has been asked to investigate whether possible collusion and other illegal activities among power generators are behind the huge jump in California's electricity and natural gas prices. ``We are concerned that market power is being abused by generators in the electricity market to inflate prices and gouge consumers,'' California Democratic U.S. Sen. Barbara Boxer and California State Senate President Pro Tempore John Burton said in a letter to Reno late on Thursday. ``We request that the Department of Justice investigate potential collusion and any other unlawful acts by generators in the electricity market,'' they added. They noted in the letter that one-fourth of the state's generating plants -- representing 11,000 megawatts of power -- were shut down last weekend, allegedly for repairs or routine maintenance, when California citizens faced rolling blackouts. ``Some have suggested that one reason for plant shutdowns is that in some cases companies are selling natural gas they would otherwise use to operate their plants at exorbitant prices on the natural gas market,'' they said. If true, Boxer and Burton said it would explain some of the electricity shortage problems and raise concern about irregular activity in the natural gas market. In a related action, they sent letters to power company executives asking them to explain why their firms shut down generators while California faced power shortages. Wholesale electricity prices in the state have soared as high as $1,400 per megawatt hour. Boxer and Burton admitted time is running out for Reno to take action since a new attorney general will take the helm of the Justice Department when Republican George W. Bush assumes the presidency in late January. ``However, this crisis in upon us now,'' they said. ``I hope you will take immediate steps to address this matter, thereby setting a strong example of leadership for the new attorney general to follow.'' "This e-mail, including attachments, contains information that is confidential and it may be protected by the attorney/client or other privileges. This e-mail, including attachments, constitutes non-public information intended to be conveyed only to the designated recipient(s). If you are not an intended recipient, please delete this e-mail, including attachments and notify me by return mail, e-mail or by phone at 212 424-8125. The unauthorized use, dissemination, distribution or reproduction of the e-mail, including attachments, is prohibited and may be unlawful. John Klauberg LeBoeuf, Lamb, Greene & MacRae, L.L.P. 212 424-8125 jklauber@llgm.com