However, the item you posted that I liked the best was toward the end about Ernon being such a small player and yet being the focus of all the blame.
Davis's relentless campaign to lay all or even some of California's electricity troubles at Enron's doorstep is ludicrous on its face.
If one takes a look at all the examples and disects them, yes there are elements of price gouging. Sometimes they are gouging because of government regulation imposing huge fines. Sometimes by are because government actions regarding pipeline regulation. Sometimes they are because of government caused panic buying. But usually, the examples don't add up to the huge $8 billion dollar claim that keeps coming out of Gov Davis office.
In my opinion, if California paid an $8 billion penalty in the California energy crisis; probably $1 or 2 billion was due to California air regulations,$2 or 4 billion was due to very high natural gas prices, maybe $200 to $400 million was due to price gouging, and the rest was due to ISO/DWR/PX incompetence & panic buying. In summary, if Davis is right about the $8 billion, most of it was under the control of the folks he appointed or who were controlled by those he appointed.
Hard-Boiled Bidding for Kilowatts Water agency said to be in over its head as a trader
By nearly all accounts, the luckless bureaucrats at the DWR are being torn to shreds by professional energy traders, who see in California's power- purchasing plan a golden opportunity to make off with billions in extra profits."It's like being in a lion cage or a snake pit, however you want to define it," Hannigan said. "We've definitely gotten burned. That goes without saying."
In fact, state officials estimated last week that the DWR is shelling out roughly $350 million a week on the volatile electricity "spot" market and will have spent almost $4 billion by the end of the month.
[snip]
Several industry sources said they had been advised not to discuss the DWR's performance since a trading manager at Bonneville Power Administration in Portland, Ore., was quoted as saying that California's new electricity buyers "agree to prices that make you wonder."
The manager, David Mills, told the Wall Street Journal that the DWR is so out of its depth that he has instructed Bonneville's traders "to cut California some slack" by occasionally offering cut-rate prices.
A Bonneville spokesman said last week that Mills had been misquoted, but the damage already was done: The DWR is now widely perceived in energy circles as a pushover.
At this rate, the state will use up by the end of July the entire $10 billion authorized by the Legislature for power purchases.
And speaking of "overscheduling" (transmission line congestion), from California Struggles in Role Of a Large Buyer of Power
Many of the contracts contain "take or pay" provisions that commit the state to pay for power for five to 20 years, whether or not it is needed. That may help to explain why in June a new problem has cropped up -- "overscheduling" -- where the state, at times, has ordered too much power to be delivered. To keep from overloading electric lines, the ISO has had to order some generating units to produce less juice.
And speaking of emission regulations: From Air Emission Credits Called High Priced
In effect, companies are investing in air-emission credits in much the same way they invest in stocks.Coy said one company, Pinnacle West, registered a $412,500 air-emissions credit purchase on March 12, then sold the same credits March 29 for more than $1 million.
The increase in the costs of credits roughly paralleled the state's surge in wholesale electricity prices.
Three years ago, one type of credit sold for $451; this year it went for more than $45,000.