Posted on 08/02/2006 12:31:16 PM PDT by NormsRevenge
A federal appeals court ordered energy regulators Wednesday to consider ordering stiffer penalties for power companies that manipulated the market and caused blackouts during the 2000-2001 energy crisis.
The 9th U.S. Circuit Court of Appeals said the Federal Energy Regulatory Commission's 2003 handling of some of the fallout from California's energy crisis was "arbitrary, capricious and an abuse of discretion."
The state has sought reimbursement for an estimated $8 billion to $10 billion paid by consumers and businesses for overpriced power. FERC ordered energy companies, including several subsidiaries of bankrupt Enron Corp., to pay about $3 billion for market manipulation.
Those repayments cover the period from Oct. 2, 2000 - when power companies were put on notice they could be forced to pay refunds - to June 20, 2001. A three-judge panel of the court said FERC must entertain allegations and possibly demand refunds for market manipulation that occurred before Oct. 2, 2000.
California is seeking $2.8 billion in refunds before that date. But California is unlikely to get that much because some power purchases by state agencies were not covered by the opinion.
"It appears the court took away more than it gave," said Tom Dresslar, spokesman for Attorney General Bill Lockyer.
The limited decision covers power purchased by the California Independent System Operator and the now-defunct California Power Exchange. For procedural reasons it didn't cover emergency purchases by the state Department of Water Resources.
Lockyer's office was analyzing how much the ruling will affect California.
The 80-page ruling covered some 200 petitions by power companies, public utilities, and government agencies.
The state alleged it was the victim of widespread manipulation of both the price and supply of energy in a newly deregulated electricity market. As prices soared, the state faced energy shortages and sporadic blackouts. The crisis cost the state billions of dollars and disrupted energy markets across the West.
Federal regulators capped wholesale power prices and instituted other changes in June 2001 that quickly ended the crisis. But by then, the state's largest utility had filed bankruptcy and two others had billions in debts.
The case is California Public Utilities Commission v. Federal Energy Regulatory Commission, 01-71051.
Feds: "But we have no excuse to prosecute."
Ninth Circus: "Find one."
Can we please split the 9th Circuit?
How's about Tim Belden's (Enron) admission that market manipulation started in 1998?
They aren't arguing with Enron. Enron is defunct. They aren't going to be giving refunds.
Somebody call the men in the white coats the 9th circus got out the funny house again.
Enron wasn't alone in manipulating the market. In fact, it couldn't have manipulated the market to the extent it did without colluding with other companies in the industry.
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