Despite a negative ruling earlier in the month, small energy generators, so-called qualifying facilities (QFs), continue to pursue relief from regulated rates of Pacific Gas and Electric Co. through the federal bankruptcy court judge in San Francisco who is overseeing the utility’s Chapter 11 proceedings. Separately, the PG&E utility is meeting with individual QFs to try to negotiate deals that will allow them to cover their costs of generation at minimum.

Conversely, the PG&E utility is concentrating on a continuing stream of filings to gain the court’s permission to pay conservation rebates and/ or various internal wages and incentives designed to retain critical personnel among its 19,000 workers as the company negotiates the bankruptcy proceeding.

There is much emphasis on process, and the litany of filings and rulings will not end anytime soon. In the meantime, PG&E Corp.’s CEO Robert Glynn is committed to moving the utility through the process as quickly as possible, which means the company in the weeks and months ahead must come up with its reorganization plan for the creditors and the court to review.

The QFs, which are collectively owed hundreds of millions of dollars, are not likely to gain much in the interim, judging from U.S. Bankruptcy Judge Dennis Montali’s “tentative ruling” May 16 against four of the small cogenerators sought release from their contracts. They said the contracts won’t cover their current costs of making electricity available for the grid.

Generally, in several rulings so far Montali has refused to get into rate-setting issues, preferring to leave those to the CPUC. The judge conceded that the QFs are entitled to reasonable payment for their power and he did order “immediate negotiations with the utility to increase the four operators’ cash flow so they could perform to meet the contract amounts of power that are badly needed this summer.”

PG&E’s utility spokesperson in San Francisco confirmed that the parties have been meeting, but so far there is nothing new to announce. Meanwhile, the filings and rulings on the utility’s day-to-day operations continue.

©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.