
74 Operational Risk Control
Apart from the giant California electric utilities, which filed for bankruptcy
protection, Allegheny Electric defaulted on its credit agreements and TXU Corp said
a credit downgrade of one of its European units may trigger an early bond repayment.
At the equity side, Standard & Poor’s Electric Utilities Index fell to its lowest level
since the early 1990s. Both bondholders and shareholders paid for the energy
companies’ mismanagement.
4.3 The changing nature of energy business calls for high
grade management skill
The changing nature of the energy business has meant that spot-market price
speculation has replaced long-term ...