Senator Feinstein Urges FERC to Investigate whether Perot Systems Provided
Energy Sellers Strategies to Game CA Energy Market
June 6, 2002

Washington, DC - U.S. Senator Dianne Feinstein (D-Calif.) today urged the Federal Energy Regulatory Commission (FERC) to investigate whether Perot Systems illegally provided Reliant Energy and other energy sellers with strategies to manipulate the California energy market and asked the Senate Energy Committee to hold a hearing on this matter. .

Additionally, Senator Feinstein urged FERC to investigate whether Reliant pursued any of the strategies laid out by Perot Systems and whether other companies engaged in the same practices.

According to a document obtained by California State Senator Joseph Dunn, Perot Systems helped set up the computer system behind California's electricity markets and may have provided potentially confidential information about the system to Reliant and other sellers in California's energy markets.

In letters to FERC Chairman Pat Wood and Senate Energy Committee Chairman Jeff Bingaman (D-NM), Senator Feinstein wrote:

The document obtained by Senator Dunn "includes 43 graphic slides from a computerized presentation made to Reliant Energy and other sellers in California's energy market. The presentation discusses 'holes' in the bidding system of the California Power Exchange and the California Independent System Operator and informs energy companies about how they can 'affect prices and destabilize the Power Exchange market' in California. It explained 'How to Prosper in the California Market Structure' and essentially describes the Enron strategies known as 'Load Shift', 'Fat Bay' and 'Ricochet.'"

"Without further information about the verbal presentation and other documents that may have accompanied this primer, it is difficult to know whether or not this is further evidence of a concerted effort to manipulate energy prices in California. But even without knowing this, I am very troubled about why a company that was instrumental in designing the California Power Market would be making a presentation about that market's flaws to an energy company that would in turn, use that market."

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