Jerry Brown (D)
SACRAMENTO, Calif. (Legal Newsline)-Sempra Energy has agreed to pay $410 million to settle price-gouging claims stemming from contracts the company had with California during the state's energy crisis that began in 2000.
Under the deal, Sempra will provide $270 million in reimbursements to California ratepayers at the state's three largest investor-owned utilities: Southern California Edison Co., Pacific Gas & Electric Co. and San Diego Gas & Electric Co., a Sempra subsidiary.
"The settlements will put hundreds of millions of dollars back into the pockets of California energy consumers who suffered blackouts and great economic harm during the energy crisis," said California Attorney General Jerry Brown.
San Diego-based Sempra reached the agreement in principle with state and federal officials without admitting to any wrongdoing.
Sempra Chief Executive Donald Felsinger said in a statement that the agreement is "a fair and reasonable outcome for both our shareholders and the state of California."
The proposed settlement was approved last week by the California Public Utilities Commission. Still pending is final approval by the Federal Energy Regulatory Commission.
Brown said the settlement is the latest of 39 agreements hammered out by his office that will provide more than $3 billion in ratepayer relief.
Sempra was one of several energy companies the attorney general sued over contracts the state entered into with the company when wholesale energy prices skyrocketed in 2000 and 2001, rendering insolvent California's two largest utilities - Pacific Gas & Electric Co. and Southern California Edison Corp.
As a result, the state government was forced to spend billions of dollars for emergency power to keep the lights on in the Golden State.
In lawsuits, the state alleged that power companies, including Houston-based Enron Corp., created energy shortages to drive up profits, among other nefarious tactics.
From Legal Newsline: Reach staff reporter Chris Rizo at email@example.com.