Federal energy officials say Enron Corp. made more than $1.6 billion off of Western states during the energy crisis, money the bankrupt energy company may be required to return.
California officials immediately criticized the estimate as more than $1 billion too low.
It was the first accounting by federal regulators of Western energy crisis profits by Enron. The Houston company is accused by California officials of gaming the state's power market and scheming to rip off consumers.
The total was disclosed in testimony by a Federal Energy Regulatory Commission financial analyst before a FERC administrative law judge. FERC ordered the judge last summer to determine the total amount Enron should have to give back from power profits in 11 Western states from January 16, 1997, to June 25, 2003.
FERC has said Enron was in violation of its authority to sell power in the West at market-based rates during that entire period, and could be required to return all the profits it made.
Enron spokeswoman Jennifer Lowney declined comment on the testimony by FERC financial analyst Randolph A. Barlow, which said Enron generated net profits during the period, adjusted for interest and taxes, of $1,668,682.
"We're aware that the testimony has been filed and we're currently reviewing it," Lowney said.
California believes Enron should pay $2.8 billion, and the FERC staff estimate is "substantially inadequate," said Tom Dresslar, spokesman for California Attorney General Bill Lockyer.
"It highlights the deficiency of using this company-specific approach to redressing the harm inflicted on the California market and California ratepayers by Enron games," Dresslar said.
Dresslar said California reached the higher figure by taking a "market-based approach" that holds Enron responsible for developing gaming schemes that were copied by other companies and affected the entire energy market.
Enron must file its own testimony to Administrative Law Judge Carmen Cintron before a hearing set for June 13. Cintron is scheduled to release an initial decision in the case on Oct. 3.
In his testimony, Barlow notes that FERC has said Enron "potentially could be required to disgorge profits for all of its wholesale power sales in the Western Interconnect for the period Jan. 16, 1997, to June 25, 2003."
The 11 states that make up the Western Interconnect are Washington, Oregon, California, Idaho, Montana, Wyoming, Colorado, Utah, Arizona, New Mexico and Nevada.
FERC in July ordered Enron to forfeit $32 million in profits stemming from an improper business relationship with El Paso Electric Corp. from 1997-2003. At the same time the agency ordered a larger investigation of Enron's profit-making in the West during the period.
By Erica Werner By Erica Werner