FERC Approves $500 Million Mirant Settlement

The Federal Energy Regulatory Commission approved a $500 million settlement between Mirant and numerous California agencies and companies to resolve alleged power overcharges during the state?s 2000-01 energy crisis. FERC chair Pat Wood said the agreement ?will benefit customers and end the lingering uncertainty in Western energy markets.? The April 13 agreement brings to $4.6 billion the amount of energy crisis?related settlements FERC has approved. Under the agreement, Mirant will relinquish its claim to $283 million in receivables from power sales during the crisis. It will also drop its claims to another $37 million of sales made in the defunct California Power Exchange?s day-ahead market, said FERC spokesperson Bryan Lee. Mirant, which could not be reached for comment, also agreed to support the California parties? $175 million bankruptcy proceeding claim against Mirant Americas Energy Marketing. Tom Dresslar, California attorney general spokesperson, said that AG Bill Lockyer is pleased that FERC ratified the settlement the state announced in January. The $500 million is included in an earlier $750 million settlement ( Circuit , Jan. 21, 2005) announced by Lockyer that had to be ratified by FERC. Under the earlier settlement, Mirant also will turn over the partially finished Contra Costa unit 8 to PG&E to own and operate after completion. Other parts of the earlier settlement will offset unpaid bills Mirant owes to California utilities that Lockyer said were ?gouged? during the crisis. The Department of Water Resources will get $172.6 million, Pacific Gas & Electric $170 million, Southern California Edison $101 million, and San Diego Gas & Electric $23.8 million. Mirant also will cover attorneys? fees. In a second settlement at that time, Mirant agreed to forfeit to PG&E the revenues from its reliability-must-run contracts. Mirant could not be reached for comment. In other action, FERC proposed new open-access transmission tariff rules intended to help wind power. The proposed rules would limit the price that transmission facility operators could charge wind generators when the wind power deliveries vary by more than 10 percent from their scheduled transmission needs. The change generally would ease transmission tariffs for variable wind power in many cases, the commission said. The commission also gave the green light to Cheniere Corpus Christi Pipeline to build a new liquefied natural gas terminal outside of Corpus Christi, Texas. The plant will have a 2.6 billion cubic foot daily natural gas capacity. It marks the fourth new LNG plant approved by FERC.

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FERC Approves $500 Million Mirant Settlement

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