In reaction to the first detailed information alleging companies other than Enron played wholesale energy trading games in the western markets, Aquila, Williams and Sempra Energy each publicly denied they participated in the “ricochet” trading or “megawatt laundering” schemes detailed in filings last week by Portland, OR-based electric utilities PacifiCorp and Portland General Electric.

“We believe the transaction PacifiCorp describes in its FERC filing appears to be what we referred to in our FERC filing as informal ‘parking’ agreements,” said Bill Hobbs, CEO of Williams energy marketing and trading. “These transactions involved power Williams purchased from out-of-state sources — not from the California Power Exchange — and sold into California to increase the state’s supply at a time it was needed. Our records show that during the time of price caps, we did not sell to the California Independent System Operator at levels above the caps.”

Similarly, Aquila Merchant President Ed Mills said the company’s review of its trading records uncovered no trades “fitting the description” used by the Oregon utilities. “In fact, Aquila was cited in a Los Angeles Times article last year as one of the good guys in the California power market. An official of the California Independent System Operator (Cal-ISO) told how we were offering the lowest-priced power while other firms were trying to drive up the price.

“There is nothing to hide,” said Mills. “We were providing a service. We followed the rules and tried to act responsibly. We bid the power into the Cal-ISO at competitive prices, and it was accepted by the Cal-ISO and used to meet California’s energy needs.”

Both Williams and Aquila confirmed they did deals with the two Oregon utilities, but said they were within the rules for “parking” — buying power from out-of-state sources and selling it back into California. Hobbs said that Williams forbid its traders from selling power outside of California for re-sale back into the state.

Sempra Energy, whose trading unit was also implicated by the Oregon utilities repeated its mantra from the May 22 filing to FERC, arguing that it has done nothing wrong in any of its trading activity.

Sempra Energy Trading specifically in its submittal to FERC’s data request said it interviewed all of its currently employed electricity traders, schedulers, managers and operations personnel in reviewing its activity in determining that its trading was in order. It did say, however, that it does not maintain telephone logs, but records all of the phone conversations by traders. It will not attempt to review all of the telephone recordings, however, because to do so would take an estimated two years of man-hours and would be “unduly burdensome.”

Copyright 2002 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.