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Electricity providers gamed California a decade ago, judge rules

February 20, 2013|By Marc Lifsher
  • An electric transmission line runs through Panoche Valley near Hollister, Calif.
An electric transmission line runs through Panoche Valley near Hollister,… (Brian van der Brug / Los Angeles…)

SACRAMENTO -- California electricity ratepayers could get rebates of up to $1.6 billion from more than a dozen power wholesalers that allegedly manipulated the market during the energy crisis of 2000, the state Public Utilities Commission announced.

The commission in a statement released late Tuesday praised an "initial decision" issued Friday by a federal administrative law judge that ruled in favor of the state in a complaint filed with the Federal Energy Regulatory Commission.

The judge's ruling, which still must be endorsed by the full commission known as FERC, found the power wholesalers guilty of overcharging California utilities and limiting electricity supplies in the summer of 2000. The result was high prices and rolling brownouts and blackouts throughout the state that drove one utility, Pacific Gas & Electric Co., into bankruptcy.

The alleged manipulators, the PUC said, citing the judge's ruling, included Powerex, a wholly owned subsidiary of British Columbia-based BC Hydro; Shell Energy North America, a subsidiary of Shell Oil; TransAlta Corp. of Alberta, Canada, and the Bonneville Power Administration, part of the U.S. Department of Energy.

None of the companies could be reached for comment.

PUC President Michael Peevey called the initial ruling by the judge a vindication for complaints brought by California officials on behalf of electric ratepayers.

"We've been relentless in our pursuit of economic justice for Californians who were grievously overcharged for electricity during and after the energy crisis of 2000-2001," Peevey said. "We look forward to the day when all of these cases can come to a close and consumers can see the benefit of refunds of the overcharges."

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