----- Forwarded by Jeff Dasovich/NA/Enron on 12/19/2000 12:21 PM -----

	Joseph Alamo
	12/19/2000 12:05 PM
		 
		 To: Miyung Buster/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
		 cc: Susan J Mara/NA/Enron, Sandra McCubbin/NA/Enron, Jeff Dasovich/NA/Enron, 
Mona L Petrochko/NA/Enron, Roger Yang/SFO/EES@EES, Paul Kaufman/PDX/ECT@ECT, 
Lysa Akin/PDX/ECT@ECT
		 Subject: Orange Co. Register, Tues 12/19: "Suits allege utilities conspired 
on prices"


Suits allege utilities conspired on prices 
ENERGY: Southern California Gas, El Paso Natural Gas, SDG&E are targeted. 
December 19, 2000 
By KATE BERRY
The Orange County Register 
Two lawsuits filed in Los Angeles on Monday allege that Southern California 
Gas and San Diego Gas & Electric conspired to manipulate the natural gas 
market in Southern California, creating an artificial shortage that caused 
electricity prices to skyrocket this year. 
The two lawsuits, both seeking class action status, were filed in Los Angeles 
Superior Court and seek billions in damages. 
The lawsuits allege that executives of SoCal Gas, SDG&E and El Paso Natural 
Gas Corp., of Houston, met in 1996 and conspired to dominate the natural gas 
market in Southern California by illegally agreeing not to compete against 
each other. 
El Paso, which owns the largest natural gas pipeline serving California, 
allegedly nixed two new pipeline projects that were planned by Tenneco Inc., 
a company it acquired in 1996, in exchange for SoCal Gas refraining from 
competing on a pipeline project in Mexico, the lawsuits claim. 
"The nature of this conspiracy is not your classic price- fixing case,'' said 
Carole Handler, an attorney with O'Donnell & Schaeffer in Los Angeles, one of 
five law firms involved in the two lawsuits. 
"This was an agreement to give each of the participants an economic advantage 
in their own marketplace so they would not have to face the rigors of 
competition. It preserved Sempra's dominance in the market.'' 
SoCal Gas, the nation's largest gas distributor with 18 million customers, 
and SDG&E, with 2.2 million electricity customers in San Diego and south 
Orange County, were both acquired by Sempra Energy, of San Diego, in 1996. 
The lawsuits also name three units of El Paso Natural Gas: El Paso Tennessee 
Pipeline Co., El Paso Merchant Energy, and El Paso Merchant Energy-Gas L.P. 
SoCal Gas and SDG&E would not comment on the lawsuits, saying they had not 
been served with the complaints. 
Andrew Berg, owner of Wave Length Hair Productions in San Diego and a 
plaintiff representing retail electricity customers, said he contacted a 
lawyer after his electricity bill doubled in June. Since then, the state 
Legislature temporarily capped electricity prices for SDG&E customers. 
Natural gas is one of the core commodities used to produce electricity. The 
spot price of natural gas on the Southern California border Monday was $19.82 
per million British thermal units, compared with $54.99 per million Btu a 
week ago. 
That's up from about $3 per million Btu last December. Gov. Gray Davis on 
Friday asked California Attorney General Bill Lockyer to launch an 
investigation into higher natural gas prices in California.