California's electricity crisis of 2000 and 2001 was caused largely by flawed deregulation of the industry, especially the state's unwillingness to plan for sufficient power-generation capacity.
But California officials have claimed all along that big power suppliers and traders exploited the situation to artificially hike prices. Preliminary findings by the Federal Energy Regulatory Commission indicate the officials may have a point.
FERC investigators say Enron and other energy traders engaged in "gaming" the system in order to inflate prices. The agency found that Enron's famously Byzantine strategies involved deceit and purposely false information.
Not only electricity prices but natural gas prices may have been manipulated. Because gas fuels most power plants in the West, its price fluctuations were a major factor during the crisis.
FERC now moves into a presumably more thorough formal investigation that will focus on Enron and its dealings with other energy firms during the crisis. If clear wrongdoing is discovered, penalties could include a ban on further energy trading and the payment of substantial refunds to California rate-payers.
The probe is welcome, though the regulators' pace and breadth of inquiry does not please many of its critics in the Golden State. Meanwhile, Californians are still paying for the mistakes made by their own leaders in a bungled deregulation.