I 

108TH CONGRESS 

2D SESSION H. R. 5049

To require the Federal Energy Regulatory Commission to revoke the authority 

granted to Enron to sell electricity at market rates and to prohibit 

Enron from enforcing certain contract provisions, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 9, 2004

Mr. INSLEE (for himself, Mr. LARSEN of Washington, Ms. BERKLEY, and Mr. 

HONDA) introduced the following bill; which was referred to the Committee on Energy and Commerce 

A BILL

To require the Federal Energy Regulatory Commission to 

revoke the authority granted to Enron to sell electricity 

at market rates and to prohibit Enron from enforcing 

certain contract provisions, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. CONGRESSIONAL FINDINGS. 

4 The Congress finds that: 

5 (1) Valid contracts based on free, fair, and 

6 arms length transactions should be respected, but 

7 contracts based on dishonest and fraudulent activi8 ties diminish trust in market transactions, hinder 
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1 economic growth and do not warrant protection 

2 equal to that of fair and valid contracts. 

3 (2) The Enron Corporation and or agents of 

4 the Enron Corporation willfully engaged in manipu5 lation of the electricity market in the Western Inter6 connect for many months during the years 2000 and 

7 2001, creating the West Coast Energy Crisis. Dur8 ing the West Coast Energy Crisis, the Federal En9 ergy Regulatory Commission failed to act in a timely 

10 manner in enforcing the Federal Power Act to en11 sure Just and Reasonable rates during the West 

12 Coast Energy Crisis. 

13 (3) During the West Coast Energy Crisis, the 

14 President of the United States, the Vice President of 

15 the United States, the Secretary of the Energy, and 

16 the Federal Energy Regulatory Commission repeat17 edly stated that the Federal Government would not 

18 take action to control the fraudulent prices of elec19 tricity, leaving many utilities no choice but to enter 

20 into fraudulent contracts with Enron. 

21 SEC. 2. FRAUDULENT AND MANIPULATIVE MARKET ACTIVI22 TIES BY ENRON. 

23 (a) REVOCATION OF MARKET RATE AUTHORITY.—

24 The Federal Energy Regulatory Commission shall issue 

25 an order revoking the authority granted to the Enron com-
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1 pany (and any affiliate of the Enron company, the bank2 ruptcy trustee for the company and any successor in inter3 est to the Enron company or any affiliate thereof) to sell 

4 electric energy at market-based rates. Such revocation 

5 shall be effective retroactive to the date on which the com6 mission determines that the Enron company initially en7 gaged in the manipulation of prices for electric energy 

8 sales or engaged in any fraudulent activity with regard 

9 to such sales. 

10 (b) CLAIMS FOR DAMAGES BY ENRON PROHIB11 ITED.—In the case of any contract for the sale of electric 

12 energy or natural gas by the Enron company of any affil13 iate of the company which has been terminated by Enron 

14 or by the purchaser or under which the purchaser has 

15 ceased to accept delivery of electric energy or natural gas, 

16 the Federal Energy Regulatory Commission shall issue an 

17 order prohibiting the Enron company (and any affiliate 

18 of the Enron company, the bankruptcy trustee for the 

19 company and any successor in interest to the Enron com20 pany or any affiliate thereof) from enforcing any claim for 

21 monetary damages (including any penalty for contract ter22 mination) or from otherwise enforcing contract provisions 

23 against the purchaser.

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