12.02.11

Cantwell Video Statement on the 10th Anniversary of Enron’s Bankruptcy

Cantwell: ‘Enron’s a lesson that has been way too expensive to learn the second time around’

WASHINGTON, D.C. – Today, U.S. Senator Maria Cantwell (D-WA) released the following video statement on the 10th anniversary of the day Enron filed for Chapter 11 bankruptcy.

Link to video.

“Enron’s manipulation of electricity markets really hurt the Northwest,” Cantwell said. “We had a drought, and that meant we had to go out and buy electricity on the open market and it cost so much more because of that market manipulation. So people lost their homes, people lost their pensions. And a lot of businesses, for a while, paid very exorbitant energy costs.

“With Enron, we saw a manipulation of electricity markets. And what we see today is a lack of transparency and rules in the derivatives market that has caused an implosion in our economy. So what we know from Enron is that these experiments of deregulating without oversight and not having transparency in markets, is a big mistake. It’s a lesson that’s been way too expensive to learn the second time around.”

On December 2, 2001 Enron filed for Chapter 11 bankruptcy leading to the dismissal of more than 22,000 employees. From her first days in office Cantwell pushed to expose Enron’s manipulation of deregulated energy markets. Cantwell has spent over a decade fighting to protect Washington ratepayers in the aftermath of the Western Energy Crisis caused by scheming at Enron.

Cantwell helped uncover numerous ‘smoking gun’ audio tapes and memos that detailed the tricks Enron used to artificially drive up electricity prices. Enron traders were recorded coming up with names like ‘fat boy’ and ‘death star’ for the schemes they used to deceive ratepayers.

Cantwell helped author provisions in the 2005 Energy Bill that made it a crime to manipulate electricity or natural gas markets. As of March 2011, the Federal Energy Regulatory Commission (FERC) has used the law to conduct 93 investigations resulting in 45 settlements and civil penalties of $122,230,000 and disgorgement of profits totaling $35,945,000.

Cantwell also secured a provision in the Energy Policy Act of 2005 that prevented a bankruptcy court from forcing Snohomish Public Utility District (PUD) and its customers to pay millions of dollars in termination fees for electricity that was never delivered. This measure reaffirmed FERC’s authority to decide whether charges related to manipulated power contracts could be deemed invalid.

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