July 15, 2005
ROSEMEAD, Calif., July 15, 2005 – Southern California Edison (SCE) and the other California Parties seeking refunds of energy overcharges during the state’s 2000-2001 energy crisis today announced they have reached a settlement resolving claims against Enron Corp. and a number of its affiliates.
The settlement resolves specified claims made by SCE, Pacific Gas and Electric, San Diego Gas & Electric, the California Public Utilities Commission (CPUC), the California Electricity Oversight Board, the California Department of Water Resources Electric Power Fund, and the California Attorney General. The attorneys general of Oregon and Washington are also parties to the settlement.
“We are very pleased our customers will receive a measure of compensation for the harmful impact of Enron’s well-publicized manipulation of California’s energy markets,” said SCE Chairman John Bryson. “This settlement represents another positive step in our ongoing efforts to achieve reimbursement on behalf of our customers for the effects of the California energy crisis.”
The settlement calls for Enron Power Marketing Inc. (EPMI), through which Enron conducted its power marketing operations in California, to make a cash payment of $47.3 million and to allow an unsecured claim of $875 million against EPMI in Enron’s bankruptcy proceeding. Additionally, Enron agreed to a civil penalty of $600 million against EPMI in favor of the attorneys general of California, Oregon, and Washington, the CPUC, and California’s Electricity Oversight Board.
The actual value and timing of the allowed claim is uncertain due to EPMI’s bankruptcy status. The current estimated value of a claim is 22.8 cents on the dollar. By CPUC directive, settlement proceeds refunded to SCE customers will offset generation costs.
“We commend the staff of the Federal Energy Regulatory Commission (FERC) for its significant contribution to the Enron settlement,” said Bryson.
The settlement is subject to the approval of the CPUC, FERC and the Enron bankruptcy court. If approved, it would resolve, among other things, Enron’s portion of claims by the California Parties in the current FERC refund case, any additional refund obligations it might have incurred at FERC for sales into California energy markets during the summer of 2000, and certain potential civil claims.
California Parties Settlements Recovering Energy Crisis Overcharges
|El Paso*||March 20, 2003||$1,700,000,000||$405,000,000||24%||Aug-04|
|Williams||Feb. 25, 2004||$417,000,000||$41,000,000||10%||Apr-05|
|Dynegy||April 26, 2004||$281,500,000||$43,000,000||15%||Apr-05|
|Duke||July 13, 2004||$200,000,000||$48,000,000||24%||Apr-05|
|Mirant||Jan. 14, 2005||$495,000,000||$101,000,000||20%||Jan-06|
|Enron**||July 15, 2005||$922,000,000||To be determined||To be determined|
* The El Paso proceeds include SCE's presumed share of CDWR's refunds. Half of the refund was paid up front and half will be paid over 15 years.
** The actual cash value of the Enron claim in excess of $47 million will be determined by bankruptcy court. It is currently estimated at 22.8 cents on the dollar.
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An Edison International (NYSE:EIX) company, Southern California Edison is one of the nation’s largest electric utilities, serving a population of more than 13 million via 4.6 million customer accounts in a 50,000-square-mile service area within central, coastal and Southern California.