No Date for Power Refunds
Californians seeking refunds more than five years after power prices in the state’s wholesale markets reached record highs will have to keep waiting, federal regulators said Wednesday.
“It is not possible to provide a date certain at this time for the conclusion of the California refund proceeding,” the Federal Energy Regulatory Commission said in a report to Congress.
Federal regulators began recalculating power prices in July 2001 for sales on California’s wholesale market between Oct. 2, 2000, and June 21, 2001. The commission is trying to determine the correct price of electricity, based on supplier costs at that time. Power markets in California were subject to manipulation by power sellers during 2000-2001, when annual electricity costs in the state increased from $7 billion to $27 billion, according to the California Independent System Operator.
The commission said it had already facilitated $6.3 billion in settlements between power buyers and sellers in the state. The amount of money refunded from the recalculated power prices is unknown, because some of the settlements include amounts from the refund proceeding.
A December 2002 decision by a commission judge estimated the refunds from power suppliers would be $1.8 billion. That amount would be offset by the $3 billion still owed by power buyers, including Pacific Gas & Electric Co. and Southern California Edison. Those figures were changed by a later ruling that adjusted fuel prices for power suppliers, and the commission says it does not know what the refund amount is now.
Legal challenges and repeated disputes on the price recalculation methods have slowed the refunds, the commission said. The refund case has more than 100 participants, and the agency must allow for due process so that its decisions will withstand judicial scrutiny, the report said.
“No one can dispute that the California refund proceeding has gone on far too long,” said the report, which was required by Congress as part of energy legislation signed into law in August. “The lack of closure contributes to the uncertainty in California -- some refunds are still owed and owing; investment, and recovery of that investment, is unclear; and the state of the transmission grid and electricity markets remains vulnerable.”
