What is the contract between Enron Energy, Inc. and the University of California and the California State University?
A. The contract was signed in 1998 and is due to expire on March 31, 2002. It provides for Enron, a Houston-based energy supplier and broker, to supply electricity and other services to most campuses within the two university systems at a set price. Because of the contract, the universities were able to escape the skyrocketing electricity prices that have occurred over the past several months. (For example, UC San Diego saved $12.3 million over an eight-month period between April 1, 2000 and Nov. 30, 2001under the contract.) The University of California at Riverside is not included in the contract. It has a separate contract with the City of Riverside. Q. Why is Enron attempting to unilaterally change the contract? A. Energy brokers such as Enron can buy a future supply of electricity at a set price (akin to a wholesale price) for resale at retail prices to Enron customers. When the price of electricity in California began to soar under deregulation, Enron realized that it could re-sel
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