California energy officials on Thursday petitioned FERC to clear a roadblock to its plans to activate more natural gas-fired electric generation by next summer to help make up for 2,200 MW of idled capacity at a closed Southern California nuclear plant.

The California Independent System Operator (CAISO) asked the Federal Energy Regulatory Commission to allow AES Corp. to proceed with plans to revive two mothballed gas-fired units at its Huntington Beach, CA, generation facility over the objection of J.P. Morgan Venture Energy Corp., which on Wednesday was censured by FERC.

J.P. Morgan’s trading unit schedules and controls the dispatch of electricity from 10 gas-fired generating units along the Southern California coast.

Virginia-based AES has plans to repower and transform several power plant sites it operates along the Southern California coast during the next 10 years (see Daily GPI, Sept. 26). With the state’s once-through cooling seawater ban slated to be phased in over the next 10 years, AES is holding 4,200 MW of gas-fired generating capacity in its three coastal sites.

J.P. Morgan allegedly is blocking AES from upgrading and restarting the currently idle units. Meanwhile, FERC on Wednesday issued an order suspending market-based rate authority for the J.P. Morgan trading unit for six months, starting in April.

“CAISO and FERC are in lockstep on the importance of protecting the integrity of energy markets, and this includes honest and straightforward dealings by all market participants during investigations of market conduct,” said CAISO CEO Steve Berberich, who called the federal action “a strong signal to the entire market.”

FERC’s action stemmed from its conclusion that the J.P. Morgan unit misled the federal agency in its investigation of alleged overcharges to the CAISO in the state’s wholesale energy market.

Subsequently, CAISO’s FERC filing alleged that J.P. Morgan has raised legal obstacles to AES being able to finish its reactivation of gas-fired power units and repowering of others.

Earlier this fall, a spokesperson for AES’s Southern California plants said the plan is the same at all three sites: operate the latest combined-cycle, gas-fired generation units, totaling about the same size as the current AES fleet, not counting 450 MW of capacity that AES earlier sold to Edison Mission Energy.

Two of AES’s Huntington Beach units sell power to the J.P. Morgan company, and they are adjacent to the two mothballed generation units that CAISO wants brought back online to make up for the nearly year-long closure of the San Onofre Nuclear Generating Station (see Daily GPI, Aug. 14).

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