Posted on 06/27/2008 9:10:30 AM PDT by NormsRevenge
Efforts by utility regulators to reopen costly long-term electricity supply contracts struck at the height of the California energy crisis were deflected by the U.S. Supreme Court in a ruling yesterday.
The decision written by Justice Antonin Scalia sent the case back to the Federal Energy Regulatory Commission, with instructions to determine if the public interest was harmed by energy supply contracts signed in 2001.
The case was filed by Public Utility District No. 1 of Snohomish County, Wash., which entered into a long-term electricity supply contract with the Morgan Stanley Capital Group. As the crisis waned, prices dropped, but the Snohomish utility and other buyers were bound by their long-term contracts.
The legal battle poses ramifications for energy markets and utility customers in California and other Western states.
The justices deferred acting on two similar appeals related to California's energy contracts that involve San Diego-based Sempra Energy, Dynegy, Royal Dutch Shell, Iberdrola and NRG Energy.
The outcome also may affect California's efforts to save consumers $1.4 billion by cutting the price of supply contracts in that state.
“Sempra Energy is pleased with the ruling,” spokesman Art Larson said yesterday. Without such binding contracts, Larson said, Sempra would not have invested $1.3 billion to build more than 2,000 megawatts of power-generation capacity.
But the guidance in the ruling might still provide a way to reopen the contracts, said Erik Saltmarsh, former general counsel of the California Electricity Oversight Board. He said the energy crisis imposed a $15 billion burden on the state economy, and that represents a clear adverse effect on public interest.
In writing for the court, Scalia rejected arguments that FERC should have considered whether the supply contracts were “just and reasonable.” FERC declined in 2002 to intervene in the dispute and upheld dozens of contracts signed in California and elsewhere.
The 9th U.S. Circuit Court of Appeals disagreed and instructed FERC to reform the contracts. Scalia rejected that ruling, which said the contracts fell outside a “zone of reasonableness.”
The Supreme Court's 5-2 ruling instead told FERC to do a more thorough job of considering if the power suppliers were manipulating energy markets and to look at the long-term effect of the contracts on consumers.
Why not? If this Gub was much deeper in manure, he’d need SCUBA gear.
Schwarzenegger says feeding oil addiction no answer
http://www.freerepublic.com/focus/f-news/2037304/posts
The GOP apparatus’s head is just way to far up Arnold’s arse, there is no one to lead such a thing...
The bonds that were bought to pay for the energy are for 20 yrs. Repaying the bonds tiered our electric bills. We pay up to 4 different prices dependent on the number of kwh’s used. The more kwh’s used the higher the price. They are punitive and immediately doubled our electric bills.
WHOOPS, anybody?
I like the nuclear co-generation power plants that not only generate electricity but desalinate ocean water!
—
Me too.
IN the words of our Gub not so long ago..
Build it!
I am still ready to sign a recall petition and vote that moron out of office.
That’s right, the base line they give you wouldn’t run a single wide in oildale,
Over 300% base line ran $0.50 Kwh last summer.
It’s currently $0.36190 Kwh
Besides, with AB32 regulations on the fast track and the price of
natural gas, these prices may be a bargain next year.
Dang, you know where Oildale is?
hahahahahahaha
Actually, I am an 08’r, just not N.O.R.
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