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May 28, 2002
Gregoire to FERC: Reopen Northwest Electrical Refund Case

OLYMPIA -- Citing new evidence of unfair market manipulation by Enron Corp. during last year's power crisis, Attorney General Christine Gregoire today asked federal regulators to reopen the Northwest electrical refund case.

In papers filed with the Federal Energy Regulatory Commission (FERC) today, the Attorney General's Office challenged an administrative law judge's ruling last year that the Northwest power market during the crisis was competitive, and that rates charged by power generators and distributors were just and reasonable.

"Given the nature of the new market manipulation information that is coming to light, those findings … are no longer supportable," Gregoire asserts in the papers.

Memos recently released by FERC indicate that Enron, and possibly other sellers, may have manipulated energy markets throughout the West, causing Pacific Northwest utilities - and their customers - to pay inflated power rates.

"Those memos show that even Enron's own attorneys had serious questions about the company's behavior," Gregoire said.

Last summer, FERC established a formal process for California state agencies and other parties to show they were entitled to refunds. Hearings on those requests are currently underway.

In a separate case involving Pacific Northwest utilities that sought refunds, however, a FERC administrative law judge found that the Pacific Northwest power market was not subjected to unfair manipulation during the crisis and recommended against refunds.

In the legal documents filed today, Gregoire notes that even FERC Chairman Patrick Wood believes that there's evidence of unfair market manipulation throughout the West, not just in California.

"Chairman Wood obviously recognizes that this new evidence paints a much more complete picture of what likely happened in the marketplace," Gregoire said. "Electric utilities throughout the West -- not just California -- suffered because of Enron's manipulative tactics. As a matter of fairness, Pacific Northwest utilities should be allowed to make a case as to why they are entitled to recover those costs."


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