PROJECTS
California Power Market FERC Refund Proceedings, USA
The problem
A poorly designed power market, and manipulation by power marketers, led to power cuts and severe price spikes in California in 2000-2001. The United States Federal Energy Regulatory Commission (FERC) ordered power marketers to refund the manipulated market prices to power purchasers, including PG&E. Power marketers disputed many of the refunds, arguing that prices charged were reasonable in light of transmission congestion and prices in the market for emissions permits.
How we helped
Castalia assessed the situation to determine which price spikes were a result of market manipulation. We provided expert testimony on the contested charges to show that most charges were a result of market manipulation. To determine this, we examined the disputed charges and developed a counterfactual market model of the fair market price without manipulation. We also simulated the emissions trading market for nitrous oxide and sulfurous oxide to incorporate the market price for these pollutants in the fair market price.
Impact
As a result of our testimony, PG&E prevailed in almost all of its refund claims.
How can we help you?
How can we help you?
WASHINGTON, DC
+1 (202) 466-6790
1747 Pennsylvania Avenue NW, Suite 1200
United States of America
SYDNEY
+61 (2) 9231 6862
Suite 19.01, Level 19, 227 Elizabeth Street
Australia
AUCKLAND
+64 (4) 913 2800
Sinclair House, 3 Glenside Crescent
New Zealand
WELLINGTON
+64 (4) 913 2800
Level 2, 88 The Terrace
New Zealand
PARIS
+33 (0)1 85 64 10 22
3B Rue Taylor
France
BOGOTÁ
+57 (1) 508 5794
Calle 81 #11-08, Piso 5, Oficina 5-121
Colombia
Thinking for a better world.
WASHINGTON, DC
+1 (202) 466-6790
1747 Pennsylvania Avenue NW, Suite 1200
United States of America
SYDNEY
+61 (2) 9231 6862
Suite 19.01, Level 19, 227 Elizabeth Street
Australia
AUCKLAND
+64 (4) 913 2800
74D France Street, Newton South
New Zealand
WELLINGTON
+64 (4) 913 2800
Level 2, 88 The Terrace
New Zealand
PARIS
+33 (1) 73 44 26 97
6 Rue Duret
France
BOGOTÁ
+57 (1) 508 5794
Calle 81 #11-08, Piso 5, Oficina 5-127
Colombia
Thinking for a better world.