Two More Mentions

----- Forwarded by Richard B Sanders/HOU/ECT on 11/27/2000 06:05 PM -----

Eric Thode@ENRON
11/27/2000 08:41 AM

To: Richard B Sanders/HOU/ECT@ECT
cc:
Subject: Two More Mentions

Here are two of the articles....

Competition Bureau Raided Enron, Powerex Offices, Paper Says
11/23/0 9:44 (New York)

Toronto, Nov. 23 (Bloomberg) -- Canada's Competition Bureau
raided offices at Powerex Corp. and the Canadian arm of Enron
Corp., alleging the companies conspired to raise electricity
prices, the Globe and Mail reported, citing officials from both
companies.
The bureau obtained a search warrant in May, claiming the two
companies co-ordinated bids last year to drive up prices on
Alberta's central electricity exchange, the paper said. Both
Powerex and Enron Canada Corp. said charges haven't been laid, and
denied they had broken any laws.
Competition Bureau officials didn't say whether the
investigation is continuing. Unnamed sources told the paper the
bureau ``is keeping an eye on'' electricity markets in British
Columbia, Alberta and Ontario as those provinces deregulate.
On Nov. 16, Houston-based Enron, the world's biggest energy
trader, said it plans to sell a 15 percent stake in a key Indian
power project valued at $136 million.
Powerex is the power-marketing subsidiary of the British
Columbia Hydro and Power Authority.

(Globe and Mail, B1, 11/23)
Report on Business: Canadian
Competition cops raided power firms Evidence of electricity price fixing
sought in Enron , Powerex offices, warrant shows
LILY NGUYEN AND PETER KENNEDY
?
11/23/2000
The Globe and Mail
Metro
Page B1
All material copyright Thomson Canada Limited or its licensors. All rights
reserved.
The offices of Enron Canada Corp. and Powerex Corp. were raided this year by
the federal Competition Bureau, which was investigating suspected price
fixing by the two companies.
In a search warrant application last May, the bureau alleged that in the
summer of 1999, Enron and Powerex co-ordinated bids to drive up the price of
electricity on the Power Pool of Alberta, the province's central electricity
exchange, Dow Jones reported.
Both companies confirmed searches were carried out, but said no charges have
been laid and denied breaking any laws.
Eric Thode, a spokesman for Enron Corp. in Houston, which owns Calgary-based
Enron Canada, said the bureau has since returned all of Enron 's files.
Mr. Thode added the bureau has called Enron only once with a question about
the files. "It remains just allegations," he said.
"We are confident that all of our activities have been in the rules of the
Power Pool of Alberta and within applicable Canadian laws."
Both he and Wayne Cousins, a spokesman for Powerex, the trading arm of
British Columbia Hydro and Power Authority,said they didn't know if their
companies are still being investigated.
"Powerex is confident that the bureau's investigation will find that the
company has not violated the rules of the Alberta Power Pool," Mr. Cousins
said.
A spokesman from the Competition Bureau was not immediately available to
confirm whether the investigation is continuing, but sources close to the
bureau said it has been keeping an eye on the electricity markets in British
Columbia, Alberta and Ontario as those provinces deregulate.
While most of the bureau's monitoring has been in the form of advice, the
regulator has taken steps for more direct intervention, sources said.
Deregulation of the electricity market is still new and the market is not
established, giving companies in the sector ample opportunity to play with
the system, sources said.
According to the search warrant, the bureau began investigating the two
companies when Power Pool of Alberta system controllers noticed the price for
a megawatt of electricity frequently rose above $100.
In the Alberta system, participants submit bids to buy or sell power for the
following day, and the price per megawatt of power is set by the most
expensive unit needed to meet demand.
Until the Power Pool changed its rules on Oct. 20, 1999, a participant could
change the amount of power it bid or offered up until 20 minutes before the
hour of transmission. The search warrant covers the companies' actions from
June 1, 1999, to Oct. 19, 1999.
Mr. Thode said investigations of this nature are common in deregulating
markets.
"It's happened in California this year, it's happened in the Midwest, it's
happened around the globe. It's not unusual to see this type of investigation
occur," he said.
He added the Power Pool is required to call in the federal agency whenever
there are allegations.

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.