California bill would make energy price gouging a felony
By the OGJ Online Staff
HOUSTON, Apr. 26 -- California Lt. Gov. Cruz Bustamante and Assemblyman Dennis Cardoza (D-Merced) Thursday introduced a bill that seeks to imprison anyone convicted of gas and electricity price gouging in the California energy markets.
Amendments will be added that include a $1 million "bounty" for information leading to the conviction of anyone caught manipulating power and natural gas prices in the state and contributing to a run up in California energy bills, said Douglas White, a Cardoza spokesman.
Also to be added as an amendment to Assembly Bill 67x is a whistleblower provision granting civil and criminal immunity to individuals who provide the state with information regarding manipulation of the California energy market. White said the bill doesn't have a Senate sponsor yet, but its coauthor Sen. Joe Dunn (D-Garden Grove) is a logical choice.
Power producers and energy merchants say high electricity prices reflect market demand, financial risk, and their own costs, including gas prices, not price gouging.
Cardoza said he believed there are "people out there with information that could expose the current manipulation of California's energy. Providing those people with immunity is critical to ending this gouging."
The bill would also penalize corporations found to have manipulated the gas and power market with fines of up to 10% of their gross corporate assets and full restitution to the victim.
Republicans reportedly were not enamored of the felony provisions of the bill. While the bill doesn't mention companies by name, Cardoza was clear about who it targets.
Where people stand on the bill is "directly related to whether you are more concerned about the cost to California or out-of-state generators," he said. The bill "creates criminal penalties that match in significance the crimes being committed against Californians."
The California Independent System Operator alleged in complaints filed with the Federal Energy Regulatory Commission generators overcharged Californians more than $6 billion. Federal regulators said the claims were inflated by purchases from municipal and other entities over which FERC has no jurisdiction.
Cardoza said the legislation is expected to be heard in the State Assembly Energy, Cost and Availability Committee next week.