News Release

April 12, 2006

Statement from CEO Tom Schrader

Regarding Fourth Guilty Plea In ERCOT Crime Ring Case; Chris Douglas Pleads Guilty and Agrees to Repay ERCOT over $500,000

We are pleased to hear of the fourth guilty plea received from the individuals indicted for running an organized criminal enterprise inside ERCOT in 2004.  Today’s guilty plea by Chris Douglas, former senior data warehouse manager, brings us another step closer to closure of this episode.  The law enforcement process is working, and is gaining financial restitution for the benefit of the ERCOT electric market and Texas electricity customers.

BACKGROUND

Texas Attorney General Greg Abbott on Jan. 28 announced a total of 23 felony indictments against six individuals, including five former ERCOT employees, alleging organized crime and criminal conspiracy to defraud ERCOT through a web of shell companies paid for services not rendered.  The Attorney General’s announcement followed an eight-month investigation, which ERCOT supported and cooperated with in full.  The indicted former employees were former Chief Information Officer Kenneth Shoquist; former Program Development Director Steve Wallace; former Director of IT Operations and Corporate Security Chris Uranga; former Senior Data Warehouse Manager Chris Douglas; and former Physical Security Manager Carlos Luquis.  A former contractor, John Cavazos, was also indicted.  Previous guilty pleas were entered by Shoquist, Uranga and Cavazos.  Sentencing for Shoquist and Uranga is set for May 4.  Trials for Wallace and Luquis are scheduled for April 24.

Read Texas Attorney General’s news release.

The Electric Reliability Council of Texas (ERCOT) manages the flow of electric power to more than 25 million Texas customers -- representing about 90 percent of the state’s electric load. As the independent system operator for the region, ERCOT schedules power on an electric grid that connects more than 46,500 miles of transmission lines and 650+ generation units. It also performs financial settlement for the competitive wholesale bulk-power market and administers retail switching for nearly 8 million premises in competitive choice areas.

ERCOT is a membership-based 501(c)(4) nonprofit corporation, governed by a board of directors and subject to oversight by the Public Utility Commission of Texas and the Texas Legislature. Its members include consumers, cooperatives, generators, power marketers, retail electric providers, investor-owned electric utilities, transmission and distribution providers and municipally owned electric utilities.

Contact

media@ercot.com

512-275-7432