How does a pipeline company become an e-commerce company?
Cutting-edge technology let it mostly get out of owning gas and electric plants to become a middleman or broker in the wild trading of deregulated energy. Think of it as an energy eBay with algorithms. When temperatures soared in California, for example, the EnronOnline trading system let California utility companies find a company that had electricity to sell. In a world of volatile energy prices, Enron lets companies hedge their risk by purchasing energy for years ahead. The same system lets Enron do the same for other products, ranging from lumber to plastics to metals to TV ad time to bandwidth. It has built multibillion-dollar power plants around the world, but it owns them only while power sells at a premium. When competing plants are under construction, it sells. Enron also sells rather exotic products, such as weather derivatives that let companies hedge against unexpected weather: A ski lodge can hedge against lack of snowfall. Enron offered Burlington Coat Factory a weather d
