Edison-California Accord Stayed by Appeals Court 
Bloomberg 
October 31, 2001
 
 
Bailout of Edison held up by court
The Sacramento Bee
October 31, 2001
 
 
Counties ask for voice in PG&E bankruptcy / Creditors panel has mostly energy traders
Dow Jones Interactive    
October 31, 2001
 
 
US Energy Regulators To Meet With Western Governors Fri
Dow Jones Interactive
October 31, 2001
  
 
 
 
 
 
Edison-California Accord Stayed by Appeals Court 
 
 
 Los Angeles, Oct. 30 (Bloomberg) -- A plan by Edison International and California regulators to keep the state's No. 2 utility out of bankruptcy was suspended for 14 days by a U.S. appeals court. 

The 9th U.S. Circuit Court of Appeals decision came after the Utility Reform Network late Friday asked the court to freeze the plan by Southern California Edison and the Public Utilities Commission. The proposal would use consumer rates to pay $3.3 billion in company debt. 

The 9th Circuit ordered a Los Angeles federal judge to consider whether the stay should be extended. TURN will make its arguments before U.S. District Judge Ronald Lew, who approved the settlement Oct. 5. 

The San Francisco-based consumer group's stay request may delay Southern California Edison's plans to pay its creditors by March. TURN says the stay is needed because it would be difficult to collect the money to be paid to Edison's creditors should the appeals court end up dissolving the settlement. 

The settlement, reached in private, grew out of a lawsuit Southern California Edison filed against regulators to force higher rates. TURN argues that the settlement violates the PUC's own guidelines as well as state law by not allowing the public time to comment. 

TURN is one of two interveners in the lawsuit. The other, the County of Los Angeles, will likely decide today whether it plans to challenge the settlement as well. 

Rosemead, California-based Edison shares fell 46 cents to $14.53 in late afternoon trading. 

 
 
Bailout of Edison held up by court
 
SAN FRANCISCO - A federal appellate court Tuesday put the state's multibillion-dollar Southern California Edison rescue plan on hold for two weeks, telling the Los Angeles judge who approved the deal to consider staying his decision until appeals are concluded.

If U.S. District Judge Ronald Lew decides against a stay, the 9th U.S. Circuit Court of Appeals said it may consider one.

But nothing in the two-paragraph order from the circuit judges, Stephen Reinhardt of Los Angeles and Marcia Berzon of San Francisco, promised a stay or predicted the state Public Utilities Commission's bailout would be struck down.

Under the bailout plan, Edison dropped a lawsuit against the commission in exchange for the right to charge customers $3.3 billion to pay off part of its debt.

Electric rates won't go up under the agreement, but customers also won't see a potential rate decrease that might have come next year.

The plan has been challenged by The Utility Reform Network because of both the secrecy in which Edison and the PUC conceived it and its consequences for regulation of utility rates.

TURN wants to find out what's behind the plan before it goes forward, Executive Director Nettie Hoge said.

The commission and Edison downplayed the importance of the 9th Circuit's order.

"We still think the settlement is the right thing for consumers," said Terrie Prosper, a PUC public information officer.

In a prepared statement, Edison Chairman Stephen Frank called the settlement sound and said TURN's effort to block it had no legal merit.

 
Counties ask for voice in PG&E bankruptcy / Creditors panel has mostly energy traders
 
Warning that Pacific Gas and Electric Co.'s financial recovery plan is barreling toward approval with no one to speak for the public, San Francisco and other counties will ask a bankruptcy judge today to grant them powers as a separate creditors committee. 

The only committee now representing PG&E's thousands of creditors is dominated by energy traders with no incentive to stand up for communities PG&E serves, according to a motion being filed today by San Francisco City Attorney Louise Renne. She hopes to win approval for a committee of government creditors to draw up an alternative restructuring of PG&E. 

Joining San Francisco in the request to bankruptcy Judge Dennis Montali are Alameda, Sonoma, San Luis Obispo and Siskiyou counties, along with the cities of Berkeley and San Jose. 

Renne's office claims PG&E has negotiated a reorganization plan that favors energy companies whose soaring wholesale electricity rates drove the utility into Bankruptcy Court. 

Under the plan unveiled Sept. 20, PG&E would drop legal challenges against the prices charged by generators, who would receive full payment of about $9 billion. 

In return, the cities and counties say, the energy companies will not challenge the past transfer of $4.6 billion from the regulated utility to its holding company, PG&E Corp., nor try to block the unregulated parent company from taking ownership of the utility's power plants, transmission lines and natural gas pipelines. 

The 11-member creditors committee endorsed the PG&E plan two weeks after it was filed. Renne's office says the committee, which includes seven energy trading companies, including Enron and Dynegy, has kept the majority of PG&E's creditors in the dark. Attorneys for the committee could not be reached for comment. 

PG&E spokesman Ron Low said the utility would oppose formation of a new committee. "The (existing) creditors committee represents the interests of all creditors," he said. 

The reorganization plan would pay all creditors in full, Low added. 

In May, Montali refused to allow a committee of PG&E customers to represent consumers' interests in the bankruptcy proceedings. But San Francisco and other cities and counties already have standing in the case as creditors who are owed an array of payments for taxes, franchise fees and other debts. 

If Montali authorizes a new committee of government creditors, the panel could hire experts at PG&E's expense and gain access to PG&E financial filings. With those resources, Renne's office would draw up an alternative financial recovery plan for PG&E and submit it to the judge. 

Gary Cohen, general counsel for the state Public Utilities Commission, agreed with Renne that PG&E had made "a pact with the devil" by agreeing to accept generators' power prices. But rather than drawing up a competing plan, he said, the PUC may try to block PG&E's plan through legal challenges. 

 
 




US Energy Regulators To Meet With Western Governors Fri

  
WASHINGTON -(Dow Jones)- Federal energy regulators will meet with Western governors, state regulators and energy industry officials in Seattle, Wash., on Friday to discuss the adequacy of the region's energy infrastructure to meet rising demand. 

The U.S. Federal Energy Regulatory Commission technical conference will feature the governors of Washington and Arizona, as well as state regulators from California , Montana and Wyoming. 

The agenda also features remarks by utility executives and financial analysts. 

"The intent is to identify the adequacy of current energy infrastructure and its implications for the future economic development of the region in light of the anticipated growth in population and energy demand in the West," FERC said in a notice issued Tuesday outlining the conference agenda. 

"In making this assessment, the goal is to achieve a better understanding of what the infrastructure needs are for the region in the near term, whether the necessary construction is occurring, and if not, what factors are inhibiting adequate investment in infrastructure development," the notice continued. 

"Concrete actions that can be undertaken by the federal and state government decisionmakers will be discussed. The aim is to enhance energy infrastructure development to support well-functioning wholesale energy markets." 

In preparation for the conference, which piggybacks on a meeting of the Western Governors Association, FERC last week received briefings on a staff assessment of the region's energy infrastructure. 

The staff assessment found the 11-state region's electricity reserve margin was nearly 30% in the early 1990s, but has slipped to 16% since then. With projections for new power plants coming on line, that level is expected to increase to 23% during the next two years, according to the staff assessment. 

The assessment projected reserve margins could improve to 31% by 2005. But the FERC staff said that is probably an overly optimistic assessment. Efforts to project reserve margins more than two years in the future are unreliable, they said. 

Three states - California , Washington and Arizona - provide nearly 60% of the region's 650 million megawatts of net generation capacity, the staff reported. 

From 1996 through 2000, electricity produced from natural gas increased a "whopping" 221% in the region while hydropower capacity decreased 17% and other forms of generation increased only 20%, the FERC staff reported. 

Overall, installed generation capacity changed very little, because the increase in gas-fired generation "pick(ed) up the slack" from the decrease in hydropower, the staff found. 

The report noted a U.S. Geological Survey assessment that the Western U.S. has "proven and potential" natural gas reserves adequate to meet the region's demand for the next 50 years.