Paul,
I am so surprised that no one is posting here. So much good news.
DJ FERC Judge/Calif -4: Calif Upset; Pwr Suppliers Pleased
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California Attorney General Bill Lockyer said the findings are "another example of FERC not being helpful to California, to say the least." Lockyer said the commission is frustrating the state's attempts to get
redress for price gouging but added there is still time to convince federal regulators a higher refund is in order. "This is by no means over," he said .
Spokespersons for two of the larger power suppliers to California during the period in question said while their lawyers continue to pore over the judge's findings, they're initially satisfied with what they see.
"We're pleased that the judge has determined that Duke and the other generators are owed substantially more than what they would have to refund," said Duke spokeswoman Cathy Roache.
"Looking at it on the surface-level, it looks like a very positive first step," said Dynegy spokesman Art Shannon.
It wasn't immediately clear how much individual companies would owe and be owed under the judge's recommendations. Among factors the judge cited that
could affect the final refund obligations are emissions-credit costs incurred by power generators, which FERC has determined can be deducted from refund obligations.
Beyond Birchman's findings, a number of FERC developments will play into the decision whether market manipulation occurred in California and as a result
what potential refunds will be owed.
In August, FERC staff released an initial report finding natural gas prices may have been manipulated during California's 2000-01 energy shortage, driving
up the price of power from gas-fired generators. A final version of the report is expected in February or March.
Since the interim report's release, companies including American Electric Power Co. (AEP), Dynegy, Williams and CMS Energy Corp. (CMS) have admitted some of their traders submitted false data to natural gas index publications.
Over the past two months U.S. attorneys have indicted former traders with Enron Corp. (ENRNQ) and El Paso Corp. (EP). The Justice Department obtained a guilty plea from Enron's former top western electricity trader on a count of
wire fraud related to attempts to manipulate California's power market.
Meanwhile, FERC and the Commodity Futures Trading Commission are examining the extent of the misreporting of data to private firms that compile gas-price indexes, which help set the price for power.
On another track, FERC Chief Administrative Law Judge Curtis Wagner ruled in September that El Paso withheld space on the largest interstate gas pipeline
serving California during the 2000-01 energy shortage. Commissioners are expected to decide in the first quarter of 2003 whether to uphold Wagner's findings and, potentially, what type of penalties are warranted.
Wall Street is looking for progress on key Califorina-related issues at FERC including the El Paso case, the refund-request case and long-term contracts case to help clear a cloud of legal and regulatory uncertainty for the
beleaguered merchant energy sector.
-By Campion Walsh, Dow Jones Newswires; 1-202-862-9291;
campion.walsh@dowjones.com
(Jessica Berthold in Los Angeles contributed to this story.)
(END) Dow Jones Newswires
12-12-02 1812ET |
