Editorial: Price gouging redux

Friday, July 23, 2004 | 5:02 a.m.

WEEKEND EDITION

July 24 - 25, 2004

On Thursday the Federal Energy Regulatory Commission said it will review a request by Nevada's electric utilities to be released from their 2002 contracts with power trader Enron, which wants more than $300 million from them. Nevada Power of Las Vegas and Sierra Pacific of Reno note that Enron and other power traders manipulated California's deregulated energy market from 2000 to 2001. Enron shouldn't be rewarded, they reason, for gouging electricity customers throughout the West, including here in Nevada.

Last week's decision by the Federal Energy Regulatory Commission is an intriguing turnaround. Last year the commission rejected the Nevada utilities' first bid to have the Enron contracts voided -- although market manipulation had been proven. Also, during the height of the Western energy crisis in 2001, the commission refused to take steps that would have immediately stopped the price gouging. At the time the Bush White House had insisted that government intervention wasn't needed. Only after the damage had been done -- and electricity rates had gone up by billions of dollars in the West -- did the commission move against the rogue traders.

We're hopeful that the commission, which plans to render a decision next year, finally will take a serious look at this issue and that it doesn't turn out to be an election-year sop to Nevada, one of the swing states in what promises to be a very close presidential election.