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Antitrust & Business Competition
Energy
Responding to the California Energy Crisis of 2000-01, Attorney General Lockyer established the Attorney General's Energy Task Force to investigate and seek remedies for harm caused by market manipulation and other unlawful conduct. While substantial litigation and investigation by the Energy Task Force continue, enforcement actions brought by the Attorney General have generated settlements thus far with a combined value of more than $2.1 billion, including more than $1.6 billion in ratepayer benefits paid by power companies.
A review of the deregulated marketplace finds California's first effort at open competition among power companies has failed to fulfill its promise of cheap and reliable power. Instead of seeing prices reduced by the deregulated electricity market, ratepayers and taxpayers were stunned by blackouts and huge bills as they watched energy generators and traders game the system, inflate prices and enrich themselves.
The Attorney General's examination of the breakdown in the state's
deregulated energy market from a law enforcement perspective
yielded the 90-page report,
Attorney General's Energy White Paper [1.2M/90 pages]. The report has been
sent to Congress, the California Legislature, the governor and
state and federal regulators with recommendations for needed
changes.
"California is still reeling from the Energy Crisis of 2000-01
and trying to understand what went wrong," Lockyer said. "From
a law enforcement perspective, substantial reforms are needed
to fix the defects. The current system serves to shelter wrongdoers,
provides powerful incentives for energy sellers to game and
gouge and too often leaves ratepayers in the dark."
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