Nevada Power Co. last Wednesday filed a federal lawsuit against Southern Nevada Water Authority (SNWA), several officials with the Colorado River Commission (CRC) and a former Enron Corp. trader in which Nevada Power alleges that the defendants manipulated western power markets in 2000-2001 at the expense of the Nevada-based electric utility.

Nevada Power filed the lawsuit in the U.S. District Court for the District of Nevada. Defendants named in the legal action are: SNWA, CRC Executive Director George Caan, CRC Deputy Director Gail Bates, CRC Power Division Chief William Miller, Miller’s assistant Timothy Clemens, SNWA senior electrical engineer John Evans and former Enron trader Paul Choi.

Nevada Power is seeking compensatory and punitive damages, injunctive relief and attorneys’ fees and expenses.

In the lawsuit, Nevada Power alleges that the defendants “caused Nevada Power to buy and sell electricity based on CRC’s misrepresentations, knowingly and fraudulently concealed their scheme from Nevada Power, caused Nevada Power and its customers significant economic losses and generated improper profits for CRC, SNWA, Enron and other private entities at Nevada Power’s expense.”

The utility further alleged that the defendants “along with others designed and implemented schemes to join the energy gaming in California and obtain improper profits” at Nevada Power’s expense, according to the lawsuit.

“Lacking the ability to buy and sell directly in California, defendants partnered with Enron and others to create a way to buy and sell electrical energy surreptitiously,” Nevada Power said. “Defendants then intentionally exploited Nevada Power’s obligations to keep the southern Nevada transmission grid in balance — that is, constantly matching electrical input with electrical output — by deceiving Nevada Power into buying from, or selling to, CRC ‘imbalance energy’ at set rates.”

The utility went on to assert that the defendants “disguised their scheme and misrepresented CRC’s anticipated electrical needs to live off Nevada Power’s system, and artificially create energy in the California wholesale energy market without a risk of loss.” The defendants “imposed all of the risks of their schemes on Nevada Power and received all of the profits from these schemes.”

Moreover, Nevada Power alleges in the lawsuit that the defendants “carried out a significant part of their deception through the submission of false energy schedules.” According to the utility, the “false schedules stated that CRC needed more power to serve its relatively static load requirements than it really did.”

In addition, Nevada Power asserts that the defendants “professed to one another, on recorded telephone lines, that the actions against Nevada Power will not stop until ‘we drive them into bankruptcy.'” Although the utility “has survived, it has nonetheless been severely damaged by defendants’ actions.”

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