Springs Utilities part of federal energy inquiry

0 Comments | Gazette, The (Colorado Springs), May 14, 2002 | by Wayne Heilman

Federal regulators are seeking information from Colorado Springs Utilities and more than 100 other utilities on trading strategies used during the 2000-2001 California energy crisis.

The utilities face losing their licenses to sell electricity unless they submit sworn affidavits detailing their trading strategies during the crisis. The statements must be signed by the chief executives of the utilities after completing an investigation of trading.

Don Miles, a Springs Utilities spokesman, said Monday the city- owned utility will comply with the order by the May 22 deadline.

Wayne Vanderschuere, resource supply manager for Utilities, said the utility neither can nor will manipulate California's energy market.

"We are not big enough to affect that market," he said.

It is not clear why the Federal Energy Regulatory Commission is targeting Utilities, which must buy about 20 percent of its electricity on a wholesale basis. The utility was buying about 8 percent of its power from Enron Corp. before the company's bankruptcy.

The agency's order targets utilities ranging from Houston-based El Paso Corp. and Kansas City, Mo.-based Aquila Inc., which both have natural gas operations in the Springs, and Minneapolis-based Xcel Energy Inc., Colorado's largest electricity provider.

The order comes after the agency released two Enron memos, both dated December 2001, that show the energy giant manipulated the California electricity market by first creating, then earning fees to relieve congestion in the state's power grid.

The Enron memos said other companies used similar trading methods. The statements the agency is seeking must either admit or deny the utilities participated or engaged in schemes similar to Enron's alleged manipulation and must include any related documents.