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Date: Tue, 5 Jun 2001 05:12:00 -0700 (PDT)
From: steve.hall@enron.com
To: richard.sanders@enron.com, tim.belden@enron.com, christian.yoder@enron.com, 
	gfergus@brobeck.com
Subject: California Senate to issue subpoenas to Enron, others
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Panel OKs Subpoenas for Energy Companies 
Electricity: Special state Senate committee will demand pricing information 
in inquiry into whether California has been gouged. 
By CARL INGRAM, MIGUEL BUSTILLO, Times Staff Writers


SACRAMENTO--The Senate Rules Committee agreed Monday to issue subpoenas to 
eight out-of-state power generating companies demanding documents on pricing, 
bidding and other aspects of electricity sales in the state. 
Sen. Joe Dunn (D-Santa Ana), chairman of the special Senate committee that is 
investigating whether power wholesalers are illegally profiteering from 
California's energy crisis, said he expects the companies to resist. That 
would set the stage for a court fight, he said. 
In addition to subpoenas aimed at the private generating companies, the 
committee also put the Los Angeles Department of Water and Power on notice 
that unless it voluntarily provides information on its power sales to the 
state, the data will be subpoenaed as well. And the panel threatened to 
subpoena records of the state Department of Water Resources unless it turns 
over information on how it has spent more than $7 billion to keep electricity 
flowing in California. 
Under Senate regulations, Dunn's panel needed approval of the Rules Committee 
to issue the subpoenas. 
Industry executives deny that they have broken any laws in selling 
electricity at premium prices to California's financially strapped utilities 
and the state water department. 
The subpoenas will be issued to Reliant Energy, which Gov. Gray Davis has 
publicly accused of price gouging, Dynegy Energy Services Inc., Williams 
Energy, Enron Corp., NRG Energy Inc., Duke Energy, Mirant Inc., and AES Corp. 
Dunn said executives of the generators seemed cooperative when the 
investigation was launched two months ago. Since then, he said, they have 
raised barriers, including demands that the confidentiality of their 
documents be protected. 
The demand for information from the Los Angeles DWP and the state's water 
resources department were pushed by Sen. Ross Johnson (R-Irvine), vice 
chairman of the rules panel. 
"Why are we not attempting to subpoena the Los Angeles Department of Water 
and Power? There certainly have been suggestions that they have profited," 
Johnson said, referring to reports from the California Independent System 
Operator about large profits that DWP made by selling power to the rest of 
the state. 
Reflecting the views of many lawmakers, Johnson said the Legislature also 
needs information on power purchases that the state water department makes 
from wholesalers and the bidding strategies used to make the bids. 
Davis has refused to make details of the purchases public. He contends that 
if generators knew how much the state was spending on power, they might raise 
their prices. Several news organizations and a legislator are suing to make 
the information public. 
Senate President Pro Tem John Burton (D-San Francisco), chairman of the Rules 
Committee, opposed issuing subpoenas to the city and state departments, at 
least temporarily, leading to the agreement for a one-week delay before 
subpoenas would be issued to the agencies. 
The big energy companies also took a hit Monday from a leading advocacy group 
for the poor. 
The Pacific Institute for Community Organization, a coalition of faith-based 
groups that has pressed for California to cover more of the millions of 
working citizens without any health insurance, voiced concern that the energy 
crisis is hitting the poor hardest. 
The group, which scheduled a Capitol rally today, plans to urge political 
leaders to use the economic power of the state's huge pension funds to 
leverage the companies. 
The two pension funds own at least $1.2 billion in stocks and bonds in most 
of the major firms involved in the state energy crisis, from Enron of Texas 
to Duke of North Carolina, the advocates said. 
"They could bring the voice of stockholders into the debate, as a major 
stockholder, and take a more enlightened view of what is happening to 
California," said activist Jim Keddy. "We really have no voice inside those 
companies right now." 