In a 219-page ruling released in April charging Shell Energy North America and Iberdrola Renewables of price gouging, Federal Energy Regulatory Commission Judge Steven A. Glazer said,
The public was clearly, palpably, seriously harmed by the energy crisis.
Two Firms Overcharge Californians In Energy Crisis
California’s 2000-2001 energy crisis cost the state and its utility customers a lot more than it should have. This 219-page ruling charged Shell Energy North America and Iberdrola Renewables gouged the state of $779 million and $371 million respectively.
Mike Florio, of the California Public Utilities Commission was pleased with the decision.
After 15 years of fighting in regulatory and court proceedings, we’re finally getting relief.
Power shortages and market manipulation pushed prices so high in 2000-2001 that California’s two largest electrical utilities were forced into insolvency. The California Department of Water Resources (CDWR) stepped in to negotiate contracts with various sellers to provide power.
Alleged overcharging by many of the companies led to eventual “settlements of $7.7 billion in cash and re-negotiations of long-term contracts and $4 billion in shorter-term contracts that went to the California Department of Water Resources,” which has been refunded to utility customers in the form of lower rates.
Energy North America and Iberdrola Renewables are the last two companies involved. Although the case is not over – parties involved have 30 days to file briefs and an additional 20 days to submit subsequent filings – if the FERC commissioners vote to uphold the ruling, the $1.1 billion involved would be distributed in the same way as the previous $7.7 billion.