The state attorney general has filed suit against BC Hydro?s marketing arm, Powerex, for allegedly overcharging the Department of Water Resources $850 million for out-of-market (OOM) sales in 2001. The deals refer to imports of power from outside California?s boundaries not subject to crisis-era price constraints. Attorney General Bill Lockyer charged the company with going on a ?gouging spree? during that time. Powerex had access to hydroelectric power that it could offer across state lines to its supply-constrained neighbor. This follows a December 22, 2004, lawsuit against Powerex by the state for allegedly manipulating the market through other means, such as short-selling and megawatt laundering. The complaint, filed in Sacramento Superior Court February 10, alleges that California was ?compelled to enter into real-time, out-of-market transactions? under terms that were ?exorbitant? and ?onerous.? Pursuing OOM calls appears to be a new tactic by the Attorney General?s Office. In transcripts released by the Federal Energy Regulatory Commission during its investigation of Enron for alleged manipulation, Powerex traders? comments on other trading schemes?calling them ?free money? and ?double-dipping??stood out, but little was said about the OOM calls. During that time, the ?California Parties,? including the Attorney General?s Office, claimed Powerex was responsible for 40 percent of the megawatt-laundering transactions at the time. Powerex denied the charges. Back in October 2003, FERC rejected claims that Powerex behaved inappropriately during the energy crisis. At the time, a company statement said it was ?completely cleared? of charges that it owed California more than $1 billion. ?We believe that California grossly mismanaged its energy affairs prior to and during the crisis, which was largely self-inflicted,? stated Doug Little, Powerex vice-president, on February 10. ?They failed to construct adequate generation, did not have adequate transmission in place, and passed some of the worst energy statutes ever enacted. Now they seek to make Powerex a scapegoat to divert political attention away from their own ineptitude.? Powerex stated it is in the process of reviewing California?s lawsuit and intends to ?respond vigorously? to allegations.