Wednesday, 05 September 2007 01:51
Court Decision Could Lead To Refunds For 2001 Energy Crisis Price Gouging
A recent decision by the 9th Circuit Court of
Appeals requires the Federal Energy Regulatory Commission or FERC to reconsider its refusal to
grant energy crisis refunds—which could potentially return $1.3 billion to California ratepayers.
Attorney General Jerry Brown had asked the court to reverse FERC’s refusal to grant refunds after
ratepayers suffered massive price-gouging on short-term energy purchased
in the Pacific Northwest during the energy
crisis of 2001.
In arguments before the 9th Circuit, the
Attorney General argued that FERC abused its discretion when it excluded the
state’s purchases from refund eligibility. The Court agreed with California’s position
and remanded the case back to FERC for reconsideration in light of the Court’s
decision. Commenting on today’s decision, Attorney General Brown said: “Today’s decision is a major victory for California ratepayers. I encourage FERC to
promptly refund the more than one billion that was stolen from the people of California.” FERC had asserted that California
was not entitled to refunds in the Pacific Northwest because the power was
consumed in California, not in the Pacific Northwest. Today, the Court found FERC’s
reasoning was specious and arbitrary. The Court remanded the case back to FERC,
instructing the commission to consider the evidence of market manipulation that
it had previously ignored. As a result of the decision, California can now
potentially claim $1.3 billion in refunds from non-governmental energy sellers,
the largest potential refund-payers being Powerex, Sempra, TransAlta Energy,
Coral Power and Trans-Canada.
