California’s state-chartered independent transmission gridoperator, Cal-ISO, late Wednesday asked federal regulators for helpin possible refunds of up to $550 million for December and Januarywholesale charges in the emergency real-time market. Cal-ISO toldFERC the charges exceeded federally-established benchmark levels.

The ISO said generators charged $240 million more than what was”reasonable” in the month of December and $315 million more thanwhat was reasonable in January.

“This is a first step in a federally established process ofreviewing bids above the FERC-set benchmarks,” according to Cal-ISOmarket analyst Anjali Sheffrin. The benchmark of $150/MWh was setby FERC in its Dec. 15 order and included a 60-day review period,beyond which no refunds are possible. Cal-ISO is asking for moretime and information to conduct the reviews leading to potentialrefunds.

“We’ve asked FERC to extend that period so we can have anadequate review,” said Sheffrin. He noted Cal-ISO is also askingFERC to take several other steps, including notifying powerproviders that their transaction could be subjected to longer, moredetailed review, which ran out on Thursday for the initialpurchases under the Dec. 15 FERC order’s soft cap.

Cal-ISO also has asked FERC to require generators to share theirfederally filed cost justifications with the Cal-ISO and otherstate officials so they can do their own analysis; and to subjectthe market power issues to a federal hearing to finally determineif any refunds might be due.

“We’re not saying that all generators are overcharging, we arejust trying to get more cost justification to assure the pricesare, indeed, just and reasonable,” Sheffrin said. “We’re not comingto any conclusions, we just think that California officials shouldhave all of the information necessary.”

A recently concluded study by the Cal-ISO prompted the filing atFERC. The report examined the magnitude of the payments the ISO hasmade so far over the soft-cap (about two-thirds have been at pricesabove the cap), and made a determination of reasonableness.

From this, Cal-ISO decided it needs more time and moreinformation and, thus, the FERC filing.

Since Jan. 1, the generators have had to inform FERC on allvolumes over $150/MWh so-called “soft cap.”

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