Lights Out at Power Exchange.The California Power Exchange, the marketplace where electricity was bought and sold in the state under regulation, filed for Chapter 11 bankruptcy protection. The exchange cited multiple lawsuits filed against the nonprofit corporation nonprofit corporation n. an organization incorporated under state laws and approved by both the state's Secretary of State and its taxing authority as operating for educational, charitable, social, religious, civic or humanitarian purposes. by generators since it announced it was closing down in January, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. a filing made in U.S. Bankruptcy Court bankruptcy court n. the specialized Federal court in which bankruptcy matters under the Federal Bankruptcy Act are conducted. There are several bankruptcy courts in each state, and each one's territory covers several counties. . A CalPX official said the Bankruptcy Court could better sort out the lawsuits and make sure generators owed hundreds of millions of dollars get paid. A Bankruptcy Court judge may decide the outcome of a lawsuit filed against the CalPX and Gov. Gray Davis by Duke Energy, which alleged that forward power contracts held by the CalPX and seized by the governor were done so unlawfully. The CalPX was set to liquidate To pay and settle the amount of a debt; to convert assets to cash; to aggregate the assets of an insolvent enterprise and calculate its liabilities in order to settle with the debtors and the creditors and apportion the remaining assets, if any, among the stockholders or owners of the forward power contracts totaling about $1 billion to pay power suppliers hundreds of millions of dollars owed by PG&E Corp. unit Pacific Gas & Electric and Edison International Edison International (NYSE: EIX) is a public utility holding company based in Rosemead, California. Its subsidiaries include Southern California Edison, and un-regulated non-utility assets Edison Mission Energy, a power producer, and Edison Capital. unit Southern California Edison Southern California Edison (or SCE Corp), the largest subsidiary of Edison International (NYSE: EIX), is the primary electricity supply company for much of Southern California. It provides 11 million people with electricity. . Both utilities defaulted on payments to the CalPX. Gov. Davis seized the contracts minutes before the CalPX was set to liquidate them. A spokesman for Gov. Davis would not comment on the CalPX's bankruptcy filing. The CalPX, which at one point controlled about 85 percent of the state's wholesale power market transactions, was established under the state's 1996 landmark deregulation Deregulation The reduction or elimination of government power in a particular industry, usually enacted to create more competition within the industry. Notes: Traditional areas that have been deregulated are the telephone and airline industries. law. The exchange was set up to ensure that utilities paid a transparent price for power during the transition to deregulation. The exchange operated a uniform price auction, meaning all sellers were paid the highest accepted bid for power, regardless of what their actual bid may have been. The state's three investor-owned utilities were required to buy the bulk of their power through the CalPX. In December, federal regulators announced that the CalPX's tariff, which allows it to operate in the state as a Power Exchange, would not be renewed because it was one of the flaws that contributed to the failure of California's wholesale power market. |
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