THE TWO FACES OF ENRON

Michael Giberson

Enron was an unusual place, a source of many innovative business practices, not all of which turned out to be fraudulent.

A pair of economists have found evidence that the creation of the EnronOnline trading platform contributed to market efficiency. According to a study by Donald Murry and Zhen Zhu, the two year period that EnronOnline was in operation, November 1999 to November 2001, was associated with improvements in certain measures of the informational efficiency of the market. The article, “EnronOnline and Informational Efficiency in the U.S. Natural Gas Market,” was published last year in the Energy Journal. An earlier version of the article is available online at: http://www.chgeconomics.com/docs/enrononline.pdf

Today, however, again it will be the less savory side of Enron in the news. The Federal Energy Regulatory Commission will be posting online transcripts of Enron’s recording of phone calls (reported by Blaine Hardin in this morning’s Washington Post.). The transcripts were prepared by the Snohomish County (Washington) Public Utility District, which is in the middle of a legal battle to escape a multi-million dollar contract with Enron.

I’ll add a link here once I see the transcripts posted at FERC’s website. If you have time on your hands today, randomly peruse the transcripts and email me your favorite quotes or conversations. My email address is in the left hand column; I’ll post the best quotes in a follow up.

UPDATE: This link will automatically search FERC’s website for the Enron trading documents posted online on March 1.