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Attorney General Seeks to Have Federal Energy Regulatory Commission Set Aside Order Allowing PG&E to Move Assets to New Corporation
(SACRAMENTO) – Attorney General Bill Lockyer today on behalf of the Governor and the People of California petitioned the Federal Energy Regulatory Commission to block the transfer of Pacific Gas & Electric assets to a new corporate entity.
"Given all the talk about potential bankruptcy, we are concerned that PG&E used a stealth move to shield assets," Lockyer said. "There is sparse information available in the reorganization plan. The hasty approval sought and obtained by PG&E without a public hearing prevented the interests of California consumers from being represented in the FERC review process."
The petition filed with FERC in Washington, D.C., seeks to set aside FERC's January 12 order that allowed certain holdings of PG&E to be transferred to a new corporate entity. PG&E National Energy Group, LLC and other PG&E entities asked to have their December 28, 2000, request approved within 11 days. FERC granted approval on January 12, 2001. The state's petition contends that FERC failed to give notice to the Governor and the state Public Utilities Commission, as required by law, or to hold a public hearing on the request.
"We are asking FERC to rescind its approval because of the significant implications the utility's reorganization could have as the state responds to California's current electricity crisis," Lockyer said. "We should have the opportunity to fully review the plan to protect the interests of Californians."
The state's petition noted that FERC Commissioner William Massey, in reviewing the PG&E request, suggested that "the purpose of this urgent filing, in part, is a reorganization to shield assets of PG&E Corporation's unregulated subsidiaries from the creditors of its regulated utility, Pacific Gas and Electric Company, in the event the regulated utility imminently takes bankruptcy." Massey added that "the proposed reorganization could lead to an adverse impact on ratepayers, on competition, and on regulation" and he had "received no persuasive assurance that [his] concerns are unfounded."