Death Star (business)

Death Star (business)

The Death Star strategy, named after the Death Star, was the name Enron gave to their practice of shuffling energy around the California power grid to receive payments from the state for "relieving congestion." According to the company's own memo they would be paid "for moving energy to relieve congestion, without actually moving any energy or relieving any congestion."

For example, if the California power grid was congested with energy flowing south, Enron would schedule energy to be transmitted north to Oregon. They would receive a payment from California for apparently relieving congestion on the grid. Then Enron would schedule the energy to be transferred back to its point of origin, but not through California. Ultimately the energy would end up right back where it started, and Enron would be paid by California without actually putting any electricity on their grid.