The power behind the Teeside plant where three died

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The Independent Online

Until Thursday's explosion that killed three people at its Teesside power station – the third died yesterday – the public profile in this country of the US energy company Enron was pretty low.

The $100bn firm owns Wessex Water but lacks the consumer recognition of other high-profile energy operators such as Exxon, Shell and BP.

But, behind the scenes in high political circles, Enron is extremely well known. It is a company that gives the appearance of securing what it wants – either here, such as when the Labour Government came to office vowing not to allow any more new private gas-fired power stations, only to relent in Enron's case on Teesside, or in the US, where the firm is the best connected of any to the new President, George Bush. Or even in India, where, despite enormous public hostility, it was the driving force behind plans for a massive power station that was built at Dabhol, near Bombay.

In India, Amnesty International compiled a report on the tactics used by the local contractors building the power station to get their own way. It makes for graphic reading: Sugandha Vasudev Bhalekar was in her bathroom at five in the morning when several male police officers entered her house and started beating sleeping members of her family. Mrs Bhalekar, 24, and pregnant, was then dragged from the house into the road and struck on the back with police batons. She said: "My one-and-a-half-year-old daughter desperately held on to me but the police kicked her away."

She was targeted by the police because her husband, Baba, was a leader of those who were protesting against the building of the plant.

Villagers complained they would be overcharged for their electricity, while there were allegations of corruption involving state officials. Local people were also displaced and concerns were raised about environmental damage.

Local constructors paid the state government for the hire of reserve police to protect the site but, in a damning study, Amnesty found the police engaged in a systematic campaign of mass arrests and unprovoked assaults. Amnesty called on the US companies building the plant to safeguard human rights and to establish guidelines for all security personnel at the site.

Amnesty's report – the only one ever produced by the organisation into a commercial project, as opposed to a government – was published in July 1997. The main US company, with an 80 per cent share in the Dabhol plant, was Enron.

Yet in Britain, little more than a year later at the 1998 Labour conference, Enron was able to pay £15,000 to sponsor the party's gala dinner. In all, Enron has given £27,500 to Labour's cause.

When Labour came to power in 1997, there was little prospect, seemingly, of the company's hoped-for Teesside plant going ahead. The Tories had pursued a "dash for gas" policy; Labour, out of a residual support for Britain's coal industry, voiced its opposition. But, within two years, Enron received a special exemption to build at Teesside. By November last year, Labour was right behind the "dash for gas". Stephen Byers, the Trade Secretary at the time, lifted the ban completely, thereby consenting to another Enron project on the Isle of Grain in Kent.

In the world of energy and political lobbying, Enron is king. Simon McRae, of Friends of the Earth, said: "When you look at their influence in Government-policy making, in areas like climate change, they know how to throw their weight around."

Determined to succeed in Britain, the firm hired the political lobbying organisation, GJW. One of GJW's employees subsequently boasted to an undercover journalist how he would ensure Enron would overcome the Government ban on private gas-fired stations. "The way you go about it is that you play on the existing prejudices within the Cabinet for coal, you play on the existing prejudices within the Cabinet for competition, and you play the forces off against each other. It's intimate knowledge of what's going on that produces results in the end."

The lobbyist did well and Enron got its power stations. The company continues to wield influence. This year, it was one of a select group of businesses to accompany Nick Raynsford, the government minister, on a trade mission to Egypt. Ralph Hodge, Enron's European head, has been awarded a CBE for "services to the power generation and gas industries."

Relatively obscure here it may be, but Enron touches us all our lives. In the US, the company was the biggest backer of George Bush. Its chairman, Kenneth Lay, is widely supposed to be one of the new president's energy advisers. Mr Bush is under pressure to reveal the identities of his behind-the-scenes team and it would be a shock if Mr Lay is not one of them: his company even vetted applicants for jobs on the commission regulating the US energy market. The Enron chairman is thought to have also played a key role in the shock decision by Mr Bush to drop the Kyoto global warming accord and to persuade him to open up the hitherto protected Alaskan arctic wilderness to energy exploration.

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