Memos suggest Canadian firms in Enron scheme

Memos from collapsed U.S. energy trading giant Enron have raised questions about whether Canadian firms helped manipulate the power market during the California energy crisis.

The memos suggest that Enron, working through energy suppliers such as B.C. Hydro's Powerex, used complicated schemes to drive prices higher during 2000.

Huge profits

Powerex, the energy-trading arm of B.C. Hydro, says it did rake in an extra $4 billion but knew nothing of any scheme to rig prices.

"Powerex flatly, vehemently denies any allegations that there was any price-rigging or any collusion whatsoever," said Elisha Odowichuk of B.C. Hydro. "We followed the rules."

The State of California disagrees and it's suing Powerex for a refund of alleged excess profits. U.S. regulators are also seeking answers from dozens of U.S. companies and three in Alberta: Enmax, TransAlta and TransCanada Pipelines.

California Governor Gray Davis says several companies were involved in "fraudulent efforts to increase prices and create shortages in California, which may rise to criminal activity," said.

But B.C. Hydro says all it did was sell energy to Enron. "What happens to the power after it gets to Enron is not Powerex's concern," Odowichuk said.