FERC has dismissed a complaint filed by North Star Steel Co. that asked the agency to order several Western electric utilities, the California Independent System Operator (CAISO), Enron Power Marketing Inc. (EPMI) and Powerex to refund amounts paid to them for electric energy at prices in excess of the market clearing price for electric energy sold during the California energy crisis of 2000-2001.

“Since the relief sought here consists of refunds to a retail customer, the Commission does not have the ability to order the refunds North Star requests,” the Federal Energy Regulatory Commission (FERC) said.

Along with CAISO, EPMI and Powerex, the May 2 complaint targeted Arizona Public Service Co., Nevada Power Co., PacifiCorp, Public Service Company of New Mexico and Tucson Electric Power Co.

In the filing, North Star said that during the relevant time period the company received electric service pursuant to a non-firm electric service agreement (NFESA) among North Star, the Mohave Electric Cooperative Inc. (MEC) and Arizona Electric Power Cooperative (AEPCO).

North Star was the owner and operator of an electric arc furnace steel recycling facility located in Kingman, AZ, within what is sometimes referred to as the “Desert Southwest” region of the Western Electric Coordinating Council (WECC), comprising the states of Arizona, Nevada, and New Mexico,” the complaint said.

Under the terms of the NFESA, AEPCO had the obligation to obtain electric energy from wholesale electricity providers designated and/or approved by North Star, and to schedule, transmit and, through MEC, deliver such energy to North Star at the McConnico switching station and Harris substation adjacent to North Star mill in Kingman.

“Although North Star notes that it has a retail service agreement with AEPCO, it does not identify any transaction or contract for the wholesale sale of electricity between respondents and North Star,” FERC said in its order dismissing the complaint.

The Commission said it agreed with CAISO and the other targets of the complaint that “there is no privity of contract between North Star and respondents.”

FERC pointed out that under the Western System Power Pool Agreement, a Commission-filed rate schedule to which AEPCO is a party, North Star cannot “step into the shoes” of AEPCO.

The Commission is “bound by the jurisdictional limitations” of section 201 of the Federal Power Act (FPA). Section 201 “dictates that the Commission’s rate and refund authority for sales of power under sections 205 and 206 shall be limited to wholesale transactions.”

North Star asks that the Commission order respondents of the complaint to refund certain amounts to North Star. “In other words, North Star requests that the Commission order retail refunds. Such retail refunds are beyond the scope of sections 205 and 206 of the FPA.”

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