California’s Attorney General Bill Lockyer, who has been pushing various civil and criminal actions related to the state’s 2000-2001 energy crisis, tossed a grenade into the proposed settlement between Pacific Gas and Electric Co. and state regulatory commission staff on Tuesday as alternate decisions on the case were being released by the California Public Utilities Commission.

Lockyer sent a letter to CPUC President Michael Peevey expressing “serious concerns” regarding what he called the “apparent intention of PG&E (the utility), PG&E Corp. and its directors” to be absolved of all pending litigation filed against them, such as the civil lawsuit filed by the state in January 2002 alleging they engaged in “unlawful, unfair and fraudulent business practices.”

Parts of the proposed settlement (Section 10) allow the utility and its holding company to be released from various lawsuits.

In releasing an administrative law judge’s proposed decisions and two alternate proposed decisions Tuesday, Peevey said he expected the CPUC to resolve “a few outstanding legal issues,” some of which would include the ones involving the state’s attorney general.

Lockyer said in his letter that if the CPUC approves the proposed settlement, he would ask the regulatory panel to “clarify these very important public policy issues in any order approving the proposed settlement agreement.” He said the public will be better served by “not allowing PG&E or third parties to improperly characterize the CPUC’s intent with respect to the language in the proposed settlement agreement in other state and federal court proceedings to thwart (pending California business law) actions.”

Lockyer does not want the settlement to take the heat off the utility and its holding company related to his legal action that alleged that PG&E Corp. and its directors “engaged in unlawful, unfair and fraudulent business practices by transferring approximately $5 billion in cash from the utility to the corporation through payment of dividends and common stock repurchases” prior to the utility filing for Chapter 11 bankruptcy protection in April 2001.

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