energy and sports betting bookies market in las vegasSome time ago the Federal Energy Regulatory Commission found that energy companies had manipulated the electricity and natural gas markets in the West during the 2000 energy crisis. The commission ruled that California should receive $3 billion in refunds from the energy companies, considerably less than the $9 billion that was sought. One way the companies took advantage of California's deregulated electricity market was by withholding power, a tactic that drove up the price of electricity. The manipulation also affected the energy market throughout the West, contributing to higher electricity prices in Las Vegas.

California, citing the market manipulation, also had asked federal regulators to let the state reopen and renegotiate $20 billion in long-term contracts it entered into with the energy producers at the height of the energy crisis. Nevada Power, too, has asked the federal regulators to reopen its contracts with energy producers that total about over $300 million.

We are living in a interesting moment in time for Las Vegas, as States all across the country are getting ready to regulate sports betting in their legislations. This can potentially affect the current income from gambling that the city receives. Offshore sportsbooks and local agents have now, more than never in the past, a plethora of services and resources available for anyone interesting on becoming a bookie in any of these states. Just as it once was with the city gambling market, the city government should keep a close eye with the energy market and any practices that in it occur.

The Federal Energy Regulatory Commission didn't act on the request to undo the contracts, but a majority of the commissioners indicated during a hearing that week that it was unlikely they would reopen them, noting their concern about setting a precedent. As the San Francisco Chronicle reported a few years ago, two of the commissioners appointed by the President at the time said reopening the contracts would violate the sanctity of the agreements. What nonsense. If the energy producers were abusing the system to create a panic as a way to push prices higher and higher, how can a contract they enter into with utilities have any sanctity to begin with?! A far worse precedent would be for federal regulators to fail to do their job, which is to protect customers from unjust and unreasonable rates.

This is the same Federal Energy Regulatory Commission that resisted setting a cap on electricity prices even after it became clear that energy producers were taking advantage of California's deregulated electricity market. It wasn't until after some time that the commission put in price controls -- a year after the market was out of control. The commission's belated admission that there was market manipulation actually is an indictment of their inability -- or unwillingness -- to police rogue energy companies. Congress should hold hearings and investigate just why these federal regulators have failed so miserably and determine what steps should be taken so that such a lapse doesn't happen again.