Skip to comments.Court dismisses port's suit over power crunch
Posted on 05/15/2004 8:05:21 AM PDT by Robert357
A federal court in California has dismissed a lawsuit filed by the Port of Seattle against a dozen Northwest utilities and power marketing companies, including Puget Sound Energy.
That suit charged that the companies conspired to manipulate the West Coast power market and drive up the cost of electricity during the region's supply crunch and price spike in 2000 and 2001.
But a judge in U.S. District Court for the southern district of California dismissed the complaint this week, ruling that the Federal Energy Regulatory Commission has jurisdiction over such issues.
That disclosure came from a Securities and Exchange Commission filing by Spokane-based Avista Corp., another of the defendants in the case. Avista also noted in a statement issued last month that the FERC had found no evidence to suggest that the company had engaged in an improper trading strategy or had tried to manipulate prices in the West Coast market.
"We're disappointed but not really surprised," said port spokesman David Schaefer, adding that the port hasn't decided whether to pursue the matter further.
"We're very pleased with the ruling," Puget spokesman Grant Ringel said.
The Port of Seattle is a party to another suit involving a settlement reached by the FERC and Bellevue-based Puget Sound Energy last year in an inquiry into certain electricity-trading practices; Puget was one of more than four dozen companies the FERC questioned.
In that settlement, Puget admitted to no wrongdoing but agreed to pay $17,092 to settle the case. The port and several parties from California have appealed that settlement to the 9th U.S. Circuit Court of Appeals, Schaefer said.
The Port of Seattle suit was one of dozens of legal actions filed by and with state and federal regulators and courts over the power crunch, in which West Coast spot market prices soared far above normal levels.
Those price spikes forced many utilities in the Pacific Northwest to raise rates for consumers and businesses.
The power crunch was blamed on such factors as a drought in the Northwest (which limited the availability of hydropower), growth in demand and a lack of new generating capacity.
But critics have argued that some electricity-generating and -trading firms made the situation far worse by using schemes to boost the price of electricity, such as by withholding power from the market, routing electricity out of the region and back and posting misleading price information.
The port had a long-term contract with Puget Sound Energy, according to the company's SEC filing, that was tied to an index based on the Mid-Columbia wholesale trading price. The suit contended that the defendants tried to manipulate the price of electricity through the Western Electricity Coordinating Council.
The other defendants in the Port of Seattle case are El Paso Electric, Idacorp and its subsidiary Idaho Power, Pacificorp, Portland General Electric (an Enron subsidiary), Powerex (a subsidiary of BC Hydro), Scottish Power, Sempra Energy and its subsidiaries and TransAlta Corp. and a subsidiary.
The case originally was filed in Seattle, but was transferred to California and consolidated with other suits.
I am sure that when the dust settles, "California" will be paid something, but from what I remember, the amount is less than what the state owes to other power companies. We use to say that FERC moved at glacial speeds in its decisions, but that if they rolled over you, they would crush you. I guess the courts are saying FERC has the ball on this one.
Intersting story a local reporter dug out of the footnotes in a utility SEC filing that never really got much play in the print media.
Of course the $3 billion worth of spill set aside for Federally "protected" salmon (which did more harm than good for the fish) had nothing to do with the price of power either.
What a racket.
Needless to say, this will be blamed on greedy power companies from Bush's home state.
A reporter actually did some work....Good!
Title could be FERC rules....
When I was in California several months ago, I couldn't help but notice how misinformed people (FReepers excepted) were out there. In a nutshell, they believe everything they read in the paper and see on TV.
They believe that they are being gouged by Texas Energy Pirates (both gasoline and electricity), that secondhand smoke actually causes cancer, that global warming is a reality, that the world is running out of oil, that spotted owls are really "endangered", and that the government is here to help us.
They believe it all. God help them, they're in for a shock.