Robert Badeer

Robert “Bob” Badeer was a trader at Enron’s West Power Trading desk in Portland, Oregon, who became one of the most recognizable voices of the California energy crisis. Working under Tim Belden, Badeer participated in Enron’s California power trading operations during 2000-2001, a period when the company manipulated electricity markets and extracted billions from the state’s consumers. His recorded conversation with Kevin McGowan in Houston, in which traders mockingly discussed “Grandma Millie” and the money “stolen from those poor grandmothers in California,” became the most widely cited evidence of Enron’s contempt for the people harmed by its schemes. The exchange transformed an invented character into a symbol of corporate victimization that resonated far beyond the specifics of energy market fraud.

Badeer’s email archive in the Enron corpus contains 1,428 messages spanning 2000-2002. Unlike his supervisor Tim Belden and colleagues John Forney and Jeffrey Richter, Badeer was not among those criminally charged in connection with the California energy crisis, though his voice on the Enron tapes ensured his permanent association with the scandal.

The “Grandma Millie” Recording

The Exchange

During the height of the California energy crisis, phone conversations at Enron’s trading desks were routinely recorded. After Enron’s collapse, these recordings became crucial evidence in the Federal Energy Regulatory Commission’s investigation. The tapes were initially held by the FBI and stored in a warehouse until Snohomish County Public Utility District, pursuing its own lawsuit against Enron, obtained them from the Justice Department and had them digitized.

In June 2004, FERC released more than 400 pages of transcripts covering conversations between Enron traders, company attorneys, and governmental affairs staff from 2000-2001. The release included 82 audio files selected from approximately 2,600 hours of recordings as particularly relevant to the investigation.

The most infamous recording featured a conversation between Bob Badeer at the Portland West Power desk and Kevin McGowan at Enron’s Houston central office. In this exchange, one employee asked about “all the money you guys stole from those poor grandmothers in California,” prompting the response: “Yeah, Grandma Millie man. Yeah, now she wants her money back for all the power you’ve charged right up, jammed right up her ass for $250 a megawatt hour.”

Public Impact

The “Grandma Millie” exchange, published with redactions, became emblematic of Enron traders’ callousness toward California consumers who were suffering through rolling blackouts, emergency alerts, and electricity bills that had tripled or quadrupled. The fictional grandmother became a metaphorical figure representing the millions of victims of Enron’s market manipulation, her invented name appearing in news coverage, congressional testimony, and regulatory proceedings for years afterward.

The recording demonstrated that Enron traders were not only aware they were harming California consumers but openly mocked the suffering they caused. This evidence undermined corporate claims of ignorance and reframed the California energy crisis from a story of market dysfunction to one of deliberate corporate predation.

Other Recorded Activity

The tapes and transcripts confirmed that Enron traders deliberately ordered power plants shut down through secret deals with producers, artificially clogged transmission lines to create congestion payments, sent power out of state and brought it back to evade price caps through the “Ricochet” strategy, submitted false data to California’s grid operator, and executed trading strategies with code names like “Fat Boy,” “Death Star,” and “Get Shorty.”

Career at Enron

West Power Trading Division

Badeer worked on the West Power Trading desk within Enron’s trading division, based at the Portland World Trade Center. The division was led by Tim Belden, who served as Vice President and Managing Director of West Power Trading. Under Belden’s leadership, the division grew revenues from $50 million in 1999 to $800 million in 2001, a sixteen-fold increase that coincided directly with California’s power market crisis.

The West Power desk was structured around different trading functions spanning day-ahead markets including ancillary services, transmission, and generation adjustment bids; hour-ahead markets with similar bid structures and scheduling; and real-time markets involving BEEP dispatch and balancing energy bids. Belden’s operation supervised approximately 120 staff members.

Primary Responsibilities

Analysis of Badeer’s email archive reveals his core work areas. He had the highest ownership rank in the corpus for communications regarding the California Independent System Operator, reflecting extensive engagement with the state’s grid operator. His work involved block trading for wholesale power transactions, CalPX operations regarding the California Power Exchange, scheduling and procurement to coordinate power delivery, and monitoring market structure and reform to understand the regulatory framework.

His technical operations included congestion management and transmission rights, ancillary services markets, import and export adjustment bids, generation scheduling coordination, and real-time dispatch operations. Extensive communications from California ISO officials provided Badeer with market notices, congestion management proposals, and operational updates that traders could exploit.

Organizational Position

Badeer reported directly to Tim Belden. Evidence suggests he was senior enough to receive direct inquiries from Enron’s governmental affairs staff regarding questions from CEO Ken Lay about California power prices. Sue Mara, an Enron governmental affairs employee, phoned Badeer with a question from Lay, indicating the CEO was personally consulting with traders about California operations. This connection undermines later claims by Enron executives that they were unaware of manipulation schemes occurring at the West Power desk.

Market Manipulation Context

Trading Strategies

Badeer operated within a trading operation that employed a series of fraudulent strategies documented in internal Enron memos. Tim Belden developed many of these schemes, which were later deemed illegal.

Death Star involved scheduling energy transmission to collect congestion relief payments without actually moving energy or relieving any congestion. Traders would schedule flows on transmission lines they had no intention of using, then receive payment from California for relieving the false congestion.

Fat Boy required overscheduling load to receive payments from the California ISO, claiming to supply power to subsidiaries that did not need it, then selling the purported excess at premium real-time prices.

Get Shorty involved collecting congestion payments for relieving transmission constraints that Enron itself had created through prior scheduling manipulation.

Ricochet involved buying California power at capped prices, routing it out of state to an intermediary, then selling it back into California at uncapped import prices.

Email evidence shows Badeer working extensively with CAISO scheduling mechanisms, import and export adjustment bids, and congestion management, the infrastructure underlying many of these schemes.

Crisis Timeline and Impact

California’s electricity crisis ran from summer 2000 through June 2001, resulting in three days of rolling blackouts, hundreds of emergency power alerts, Pacific Gas & Electric’s bankruptcy, and over $70 billion in costs to the state. Wholesale price spikes reached $250 per megawatt hour and higher.

Badeer’s email archive contains documentary evidence of his engagement with California’s dysfunctional market structure during this period. In August 2000, he received and forwarded articles titled “Deregulation: ‘Conspiracy of Incompetence’ Even if energy prices are being manipulated, it may not be illegal,” showing awareness of manipulation allegations even as they were occurring. By August 2000, Badeer was receiving and discussing FERC presentations on the California wholesale market investigation, indicating the traders were monitoring regulatory scrutiny while continuing their activities.

Legal Proceedings

The Three Traders Who Pled Guilty

Three of Badeer’s colleagues from the West Power desk faced federal criminal prosecution.

Tim Belden, Badeer’s direct supervisor and the head of West Power Trading, was considered the mastermind of Enron’s California manipulation schemes. He pleaded guilty in October 2002 to one count of conspiracy to commit wire fraud and was sentenced in February 2007 to two years of court-supervised release. Belden forfeited $2.1 million and avoided prison due to his cooperation with investigators.

Jeffrey Richter pleaded guilty to two counts related to manipulating energy prices. He was sentenced to two years of probation and avoided prison.

John Forney pleaded guilty to one count of wire fraud, specifically admitting to promising to supply energy Enron did not have and improperly collecting electrical grid management fees. He received two years of probation.

Badeer’s Legal Status

Available public records do not indicate that Robert Badeer faced criminal charges, entered a guilty plea, or received civil penalties from FERC during 2003-2005 or subsequently. This absence from prosecution is notable given the direct evidence of his participation in the recorded conversations.

Several factors may explain this outcome. Badeer may have entered a cooperation agreement with investigators in exchange for immunity. Prosecutors may have lacked specific evidence of his direct participation in executing fraudulent schemes, as opposed to discussing them. Limited prosecutorial resources meant focusing on ringleaders like Belden and figures higher in the organization. FERC may have reached confidential civil settlements that were not publicly announced.

The distinction between appearing on recordings that revealed callous attitudes and personally executing fraudulent transactions may have been legally significant, even if the public perception of culpability made no such distinction.

Post-Enron Career

LinkedIn and corporate records indicate that after Enron’s collapse, Badeer transitioned to the renewable energy sector. He worked as Senior Director of Business Development at Vision RNG, a renewable natural gas company, and as Vice President at Sherbino I Wind Farm LLC. This career path suggests he continued working in energy markets but shifted focus to renewable projects.

Key Correspondents

Analysis of Badeer’s email archive reveals his professional network. His most frequent correspondent was LaCrecia Davenport with 93 emails, providing administrative support. Carla Hoffman at the Portland office sent 57 emails coordinating operations. California ISO communications accounted for 57 or more official market operator notices. Tim Belden, his direct supervisor, exchanged 21 emails. Jeff Dasovich from Enron’s regulatory affairs group sent 17 emails. Shari Stack, a West Power trading colleague, and Mona L. Petrochko from Enron’s regulatory strategy team each sent 15 emails. Mary Hain from Enron’s regulatory and trading coordination group sent 12 emails.

Notably absent from his email archive is significant correspondence with Kevin McGowan, despite their appearance together on the “Grandma Millie” tape. This suggests their interactions were primarily by phone, explaining both why they were recorded and why no email trail exists.

Email Corpus

Badeer’s email archive contains 1,428 messages from 73 unique correspondents, spanning 2000-2002 with peak activity from August to October 2000 during the height of the California crisis. The archive contains substantial forwarded news articles about California price manipulation allegations, FERC investigations, Governor Gray Davis’s calls for electricity bill reductions, and market structure reform discussions.

The archive also contains detailed communications about day-ahead and hour-ahead market bidding, ancillary services procurement, transmission scheduling, congestion management proposals, and block forward financial trades. Frequent CAISO notices regarding Congestion Management Reform proposals, InterSC Trade templates, and market rule changes document his operational engagement with the grid operator.

His communication pattern appears more operational than strategic. His emails show receiving and distributing CAISO operational notices, coordinating with schedulers and other traders, monitoring regulatory proposals that might affect trading strategies, and staying informed on California market developments through news forwarding. He was less visible in emails discussing high-level strategy or communicating with Enron executives compared to Belden, though his phone conversations revealed active participation in discussions that became evidence of manipulation.

Historical Significance

Robert Badeer occupies a unique position in the Enron scandal. His “Grandma Millie” exchange became the most widely cited evidence of Enron’s corporate callousness, a piece of audio that required no expertise to understand and no analysis to interpret. Unlike complex trading strategies that needed expert explanation, the recording’s contempt for ordinary consumers was immediately comprehensible.

As a direct participant on the trading floor, Badeer could not claim the ignorance that executives like Ken Lay and Jeff Skilling attempted at trial. Yet as a mid-level trader rather than a strategist or manager, he existed in a space where individual culpability was difficult to establish even as collective wrongdoing was clear.

The “Grandma Millie” tape ensured that Badeer’s name would be permanently associated with corporate greed and market manipulation. It served as powerful evidence that Enron traders were fully aware they were harming California consumers, that the human cost of their activities was not just understood but mocked, and that corporate culture at West Power Trading celebrated profits regardless of social impact. The invented grandmother became more real, in public memory, than the actual millions of Californians who paid billions extra for electricity while Enron traders laughed about it on recorded lines.

References

This article is based on 1,428 emails in Robert Badeer’s archive in the Enron corpus, spanning 2000-2002. Primary sources include the FERC transcript releases from June 2004 and 82 audio files from the Enron investigation. Secondary sources include contemporaneous reporting from CBS News, San Francisco Chronicle, Spokesman-Review, and CounterPunch, as well as FERC investigation documents and court records from related prosecutions.