TXU abused power market, report says
AUSTIN, TEXAS - Utility TXU Corp., facing scrutiny in its planned $32 billion private-equity buyout, abused Texas's deregulated power market, an independent report says.
The Dallas company manipulated the state's wholesale power market, causing at least $70 million in higher electricity prices in the summer of 2005, the report commissioned by the state Public Utility Commission said.
TXU's wholesale arm made a profit of about $19.6 million through its anti-competitive behavior, the report said.
Overall, the investigation said TXU's actions caused wholesale prices statewide to rise an average of 15.5 percent that summer, The Austin (Texas) American-Statesman reported.
"TXU's behavior constitutes market power abuse," special projects Manager Brian Lloyd wrote in a memo about the 37-page report.
The report could lead to fines of up to $25,000 per day per violation.
TXU rejected the report's allegations, saying it "thoroughly reviewed" its conduct and believed it was "consistent with the commission's rules and policies."
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