Dynegy Settles With California Parties

April 26, 2004

April 26, 2004

ROSEMEAD, Calif., April 26, 2004 – Southern California Edison (SCE) and other California Parties today announced they have reached a settlement with Dynegy Inc. and two related parties providing for refunds against Dynegy’s charges dating back to California’s energy crisis of 2000 and 2001. 

The settlement resolves specified claims against Dynegy 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.

“Coming on the heels of a similar settlement with The Williams Cos. and Williams Power Company, this is a very encouraging development,” said SCE Chairman John Bryson.  “We continue to pursue energy crisis-related refunds on behalf of our customers and hope others will follow the example of these two firms.” 

The settlement calls for Dynegy to assign to the settling parties $259 million in receivables that would otherwise be due Dynegy from the California Independent System Operator, manager of most of California’s electricity grid, and the now-defunct California Power Exchange, an auction house that previously set the hourly wholesale price of electricity from January 1, 2000 until its collapse in January 2001.  Dynegy will also contribute to the settlement any interest due on the $259 million, plus approximately $22.5 million in cash.  The additional cash payment includes $3.01 million that Dynegy had previously agreed to pay in an earlier settlement negotiated between Dynegy and the trial division of the Federal Energy Regulatory Commission (FERC). 

SCE estimates that its share of the settlement will be approximately $40 million.  The exact manner in which such proceeds are refunded to SCE customers will be determined by the CPUC.

“We commend the staff of the FERC for their significant contribution to the Dynegy settlement,” said Bryson. 

The settlement is subject to the approval of the CPUC and FERC.  If approved, it would resolve, among other things, Dynegy’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.  The right to pursue certain other claims is preserved.

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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 12 million via 4.6 million customer accounts in a 50,000-square-mile service area within central, coastal and Southern California.