News Release

August 03, 2006


Carlos Luquis to serve 12 years in prison, pay fine of $10,000

The Electric Reliability Council of Texas, Inc. (ERCOT) welcomed today’s jury decision sentencing a former ERCOT manager to 12 years in prison and ordering a fine of $10,000.

According to an announcement from Texas Attorney General Greg Abbott, Carlos Luquis was sentenced to 12 years on each felony charge by Williamson County District Judge Michael Jergins and will pay a $10,000 fine and make restitution of $205,000.

“We welcome the news that justice is being served in the fraud perpetrated against ERCOT,� said ERCOT President and Chief Executive Officer Sam Jones.

The jury found Luquis guilty late Friday on two counts of engaging in organized criminal activity for theft and misapplication of fiduciary property for his role in what the Attorney General determined to be a six-man crime ring within ERCOT.

“Let this case be a warning to any entity or individual that seeks to defraud our electric market,â€? said Public Utility Commission Commissioner Barry Smitherman, a former prosecutor.  “Bad behavior will not be tolerated and those that seek to perpetrate it will be discovered and brought to justice.â€?

Since the criminal activity was uncovered in early 2004, ERCOT has fully supported the investigation of the individuals who conspired to set up shell companies to commit fraudulent billing, Jones said.

“ERCOT staff worked countless hours to provide documents and support to the law enforcement agencies investigating the crimes,â€? Jones said.  “We will always be grateful for the hard work of the Attorney General’s office and the Department of Public Safety and the continued support of the Public Utility Commission.â€?

Jones said ERCOT has made significant changes over the past two years in contracting procedures and business processes to build an environment of strong internal controls designed to prevent abuse of this kind in the future. 

“This is welcome news for the employees at ERCOT who want to see justice served to the individuals who betrayed our organization,â€? Jones said.  “We look forward to having this episode behind us.â€?

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.