Brendan Hoffman
* the Energy Bill (it's not dead yet)
Fri Mar 5 23:26:23 2004
64.140.158.109

* the Energy Bill (it's not dead yet)

-------- Original Message --------
Subject: [CMEP] Enron Acting Unlawfully and new Eye On Energy
Date: Fri, 5 Mar 2004 17:38:57 -0500
From: Brendan Hoffman bhoffman@CITIZEN.ORG

***please forward widely***

this email contains two (2) items: a notice and a press release.

March 5, 2004


* N O T I C E *

March Issue of Eye On Energy Now Online

The third issue of Public Citizen's monthly newsletter, Eye On Energy,
is now ready for you to read, download, and/or print and share! Stay in
the loop on:

* the Energy Bill (it's not dead yet)
* the story behind current high gas prices
* the latest on the Yucca Mountain worker health scandal
* what's happening with an embattled energy consortium still trying to
build a uranium enrichment facility after being booted out of two other
towns
* and of course, don't miss our monthly PUHCA fact (that's the Public
Utility Holding Company Act, one of the most important pieces of
consumer-protection legislation ever enacted).

you can get a pdf version of our 2-page, easily digestible newsletter
at www.EyeOnEnergy.org . enjoy!

========================================

* P R E S S R E L E A S E *

For Immediate Release: March 5, 2004
Contact: Lynn Hargis (202) 454-5183
Erica Hartman (202) 454-5174

Enron's "Bad Faith" Request to Avoid Federal Regulation as a Utility
Holding Company Is Unlawful, Public Citizen Tells SEC

Public Citizen Seeks Effective Regulation to Protect Ratepayers of
Oregon Utility

WASHINGTON, D.C. - Public Citizen today filed a motion with the U.S.
Securities and Exchange Commission (SEC) requesting that the agency
reject the latest in a string of requests by Enron Corp. for an
exemption from regulation under the Public Utility Holding Company Act
(PUHCA), a vital consumer protection act. Public Citizen's motion
demonstrates that Enron does not meet even the minimal "objective
standards" for the PUHCA exemption it now seeks.

PUHCA protects consumers from high electricity and natural gas rates by
prohibiting multi-state public utility owners from speculating in
non-utility businesses. Enron is considered a holding company under
PUHCA because it owns Portland General Electric (PGE), an Oregon public
utility that Enron acquired in 1997. The exemption Enron now seeks
applies only to companies that "temporarily" acquire utilities as a
result of foreclosure proceedings - a category that does not cover
Enron's acquisition of PGE.

Documents Enron filed requesting an exemption from PUHCA indicate that
the company is attempting to use its request as a bargaining chip to
obtain SEC approval of a reorganization plan that includes the
controversial proposed sale of PGE to a Texas investment company. The
documents suggest that Enron will agree to "register" under PUHCA only
if the SEC approves its plan.

"The SEC can't let Enron get away with this kind of maneuver," said
Lynn Hargis, an attorney with Public Citizen's energy program. "To
protect the ratepayers of Portland General Electric, the SEC should
assert its clear authority under PUHCA first and consider whether to
approve Enron's plan only after making it clear that Enron is not exempt
from regulation."

Public Citizen also has asked the SEC to find that Enron's PUHCA
exemption application was not made in "good faith," since Enron clearly
doesn't qualify for it. If the SEC so finds, Enron's ongoing
noncompliance with PUHCA while its application is pending may be found
to be unlawful.

Enron formerly claimed other exemptions from PUHCA regulation, but the
SEC determined in December that the exemptions it was then claiming were
not available to Enron (a decision that led the company to file its
claim for the inapplicable foreclosure exemption). In addition, in
previous years the SEC staff issued a number of "no-action" letters that
allowed Enron to engage in various utility activities, such as power
marketing, without regulation under PUHCA. Though the SEC's December
ruling made clear that those letters did not reflect the commission's
view, the effect of the past exemption claims and the no-action letters
was to free Enron from effective regulation for many years.

A recent analysis by Standard & Poor's credit rating agency found that
PUHCA should be more strongly enforced because it has protected utility
credit ratings. The analysis was attached to Public Citizen's motion.
Despite the many benefits PUHCA provides to ratepayers, the act would be
repealed under the energy bill pending before Congress.

"Given what we know about the benefits of PUHCA regulation, it seems
likely that the SEC's past failure to enforce it against Enron
contributed to the Enron debacle," Hargis said.

To read the motion, please go to
http://www.citizen.org/documents/enronpuchamotion.pdf .

###

Public Citizen is a nonprofit consumer advocacy organization based in
Washinton, D.C. For more information, please visit www.citizen.org.

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To learn more about this and other Public Citizen Critical Mass Energy and Environment Program campaigns, visit our website at http://www.citizen.org/cmep/

-Public Citizen's Critical Mass Energy and Environment Program
---------------------------
SEE: APFN ENRON - BUSH CONNECTIONS:
http://www.apfn.org/apfn/enron_bush.htm