Retail electric customers in Texas could end up paying hundreds of millions of dollars in inflated power rates because of industry influence on two Texas utility regulators, according to three lawsuits ongoing on behalf of a number of Texas cities.

The Texas Public Utility Commission (PUC) has been asked to turn over documents in support of charges that then-PUC Chairman Max Yzaguirre and Commissioner Brett Perlman should have recused themselves from decisionmaking on the setting of the rates-to-beat in the Texas retail market because of their previous ties to Enron.

Yzaguirre, the target of earlier attacks because of his previous position as CEO of Enron de Mexico, resigned from the PUC last January (see NGI, Jan. 7). At the time he said that although his background had been fully analyzed in conformance with PUC rules, the attacks on him were delaying PUC business and harming his family.

Perlman, who was an employee of McKinsey & Co. before joining the commission and did some consulting work for Enron, is named in two of the lawsuits. The lawsuits claim the commissioners unnecessarily increased rates, which indirectly benefited Enron’s retail affiliate, NewPower Co.

In discovery, the PUC has been asked to turn over documents allegedly detailing the two commissioners’ ties to Enron and its NewPower affiliate, which is one of the largest retail marketers in Texas. The three suits relate to three utility territories — TXU, West Texas Utilities and Central Power & Light, according to Steven Porter with the law firm of Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend of Austin, which is handling the suit

©Copyright 2002 Intelligence Press Inc. Allrights reserved. The preceding news report may not be republishedor redistributed, in whole or in part, in any form, without priorwritten consent of Intelligence Press, Inc.