FERC has alerted three power suppliers to the California market that they must justify $587,000 worth of wholesale electricity sold during Stage Three emergencies in the month of March or pay refunds.

The refund order, the third one issued since early March, cites Dynegy Power Marketing Inc. as potentially owing refunds of $469,662, Mirant California LLC (and Mirant Delta LLC and Mirant Potrero LLC) with possible refunds of $92,620 and Williams Energy Services Corp. with possible refunds of $25,574.

The latest order follows a March 9 decision in which the Commission put 13 California power sellers on notice that they might owe refunds of about $69 million for electricity sold in the state during January (see Daily GPI, March 12) , and a March 16 order that identified six California power suppliers as potentially owing refunds of $55 million for power sold during February. Dynegy Power, Mirant and Williams Energy were cited in both orders.

The most recent refund order said the three suppliers charged more than the “proxy market clearing prices” on power sales during Stage Three emergencies, which was estimated at $300/MWh for March. This was lower than the proxy price established for February ($430/MWh), but higher than the one for January ($273/MWh).

The three suppliers must either justify to FERC the higher prices that they charged to customers in the California market, or notify the Commission of their intent to pay the refunds. The Commission has yet to make any decisions about which suppliers will have to actually pay out refunds.

The March clearing price was based on the average natural gas price for Southern California Gas large-package transactions, which dropped 24% in March to $14.51/MMBtu; the average NOx allowance costs from the Southern California Air Quality Management District NOx auction, which also fell in March to $18/lb; an average NOx emissions rate of two lbs/MWh; variable operational and maintenance costs of $2/MWh; and a combustion turbine with a heat rate of 18,073/Btu/kWh.

©Copyright 2001 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.