A federal grand jury has subpoenaed records related to California’s energy crisis from at least two power sellers that state regulators have accused of scheming to drive up prices.
Both North Carolina-based Duke Energy and Oklahoma-based Williams said Friday they received subpoenas from federal prosecutors in San Francisco as part of a grand jury investigation. Matt Jacobs, an assistant U.S. Attorney, said he could not comment because the case is ongoing.
Federal investigators have sought information from a California Senate panel investigating the state’s energy crisis to find evidence of market manipulation in 2000 and 2001. The Senate panel has spent about 18 months probing the price spikes and energy shortages that led to rolling blackouts in 2001.
California owes tens of billions of dollars for power it bought when prices soared and hopes to convince federal energy regulators to order energy sellers to refund $9 billion in alleged overcharges.
Duke spokesman Pat Mullen said Friday the subpoena demanded documents and records but that he did not know the full extent of the information sought. Duke will cooperate with prosecutors, he said.
A call to a Williams spokesman for comment was not immediately returned Friday. But in a statement, the company also said it would cooperate.
John Sousa, a spokesman for Texas-based power company Dynegy, said the company had not been subpoenaed Friday to his knowledge. Calls to Reliant, Calpine, Enron and Mirant were not immediately returned Friday.
Duke also has been subpoenaed by the Commodity Futures Trading Commission and a federal grand jury in Houston about its energy trading activities, including strategies that enabled the company to boost prices. Duke has admitted to using several techniques.
The state Public Utilities Commission issued a report in September blaming most of the state’s blackouts on energy companies withholding power from the market. The report singled out the five largest energy suppliers: Duke, Dynegy, Mirant, Reliant and AES/Williams.
The generators have denied that they withheld energy, saying their aging plants worked more hours than in previous years and required frequent maintenance as a result.
Last month, in the first public acknowledgment that criminal activity helped drive up California power prices, a former Enron energy trader pleaded guilty to conspiracy in a San Francisco federal court. Timothy Belden, the former head of trading in Enron’s Portland, Ore., office, admitted to one count of conspiracy to commit wire fraud. He faces up to five years in prison and must forfeit $2.1 million.
Belden promised to cooperate with state and federal prosecutors as well as any non-criminal effort to investigate the energy industry.
Enron bought California power at cheap, capped prices, routed it outside the state, and then sold it back into California at vastly inflated prices, authorities said. The sham trades were designed to circumvent the California-only price caps on wholesale energy.