BILL NUMBER: SB 2000 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 23, 2002
AMENDED IN SENATE MAY 14, 2002
AMENDED IN SENATE APRIL 30, 2002
INTRODUCED BY Senator Dunn
FEBRUARY 22, 2002
An act to add Title 3.6 (commencing with Section 1883) to Part 4
of Division 3 of the Civil Code, relating to energy resources.
LEGISLATIVE COUNSEL'S DIGEST
SB 2000, as amended, Dunn. Electric power and natural gas:
unlawful practices.
Existing law sets forth the obligations that arise from particular
transactions.
This bill would prohibit any person engaged in the business of
generating, selling, distributing, transferring, marketing, or
trading electricity or natural gas from engaging in or knowingly
facilitating specified unlawful acts or practices
conduct . This bill would provide that a person
found in violation of these provisions would be required to disgorge
the profits from the unlawful conduct, and would be liable for,
among other things, 3 times the amount of the disgorgement and
attorney fees. The bill would require that actions for relief under
these provisions be brought in a court of competent jurisdiction by
the Attorney General or by another person, as specified.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Title 3.6 (commencing with Section 1883) is added to
Part 4 of Division 3 of the Civil Code, to read:
TITLE 3.6. UNLAWFUL ELECTRIC POWER AND NATURAL GAS PRACTICES
1883. (a) For purposes of this chapter
title , "person" means and includes a natural person,
corporation, firm, partnership, joint stock company, association, or
any other organization or entity of persons.
(b) A person engaged in the business of generating, selling,
distributing, transferring, marketing, or trading electricity or
natural gas may not engage in any of the following unlawful
acts or practices: natural gas may not engage in any
conduct that results, or is intended to result, in a significant or
sustained increase in the price of electricity or natural gas, or a
significant or sustained decrease in electric or natural gas system
reliability, including, but not limited to:
(1) The physical withholding of electricity from the
generation, sale, distribution, transfer, marketing, or trading of
electricity, resulting in increased electricity prices or the
creation of a scarcity of supply in any electricity market.
(2) The economic withholding of electricity by submitting bids
above the reasonable price for that electricity in a fair and
competitive market, resulting in any bid not being accepted
so as to force an increase in electricity prices or create a scarcity
of supply in any electricity market. competitive
market.
(3) The acquiring, using, or disseminating of electric system
reliability information in connection with the generation,
sale, marketing, or trading of electricity, resulting in increased
electricity prices by the manipulation of the generation, sale,
distribution, transfer, marketing, or trading of electricity.
reliability information.
(4) The using or providing of false or misleading information
in connection with the generation, sale, distribution,
transfer, marketing, or trading of electricity, resulting in
increased electricity prices. .
(5) The creating, prolonging, or using of shortages or outages
to increase the price of electricity.
(6) The selling, distributing, transferring, marketing, or trading
of electricity in any other state, resulting in a reduction of
supply to increase the price of electricity.
(7) .
(6) The refusing of any lawful dispatch order of
any transmission system operator to generate electricity.
(8)
(7) The scheduling of electricity into the electricity
transmission system with the intent or knowledge that the schedule
will create congestion or the false impression of congestion in that
system.
(9) The overscheduling of electricity generation into the
electricity transmission system with the intent or knowledge that the
actual load will be lower and result in congestion counterflow
payment, or the schedule will result in compensation to reduce
congestion.
(10) system, or result in congestion counterflow
payment, or compensation to reduce congestion.
(8) The selling, distributing, transferring, marketing, or
trading of electricity to any person in any other control area with
the intent or knowledge that a similar amount of electricity will be
repurchased in the original control area for the purpose of avoiding
applicable market rules.
(11)
(9) The intentional or knowing withholding of electricity
from any market subject to a price cap with the intent to sell,
distribute, transfer, market, or trade the electricity to a market
not subject to a price cap.
(12)
(10) The misrepresentation of the availability or
supply of electricity or natural gas.
(13) The misrepresentation of the supply of electricity or natural
gas.
(14)
(11) The misrepresentation of the reason or reasons for
electricity generating facility closures, outages, or maintenance.
(15)
(12) The selling, distributing, transferring, marketing, or
trading of electricity or natural gas between subsidiaries of the
same company, resulting in increased electricity or natural
gas prices.
(16) same company.
(13) The creation of an artificial increase in demand for
natural gas, or refusal to sell natural gas, in order to raise the
market price or cause any of the prohibited acts or
practices conduct set forth in this subdivision.
(17) The engaging in strategies, acts, or conduct in the sale,
distribution, transfer, marketing, or trading of electricity or
natural gas, that results in prices above the reasonable price for
that electricity or natural gas in a fair and competitive market.
(c) A person shall not knowingly facilitate conduct prohibited by
subdivision (b).
1883.1. A person who violates Section 1883 shall, in addition to
other damages, be required to disgorge the profits of that unlawful
conduct. As used in this section, "disgorgement" shall be measured by
the difference in the actual price charged for the electricity or
natural gas in the course of the unlawful conduct and the reasonable
price for that electricity or natural gas in a fair and competitive
market. In addition, a person found to be in violation of Section
1883 shall be liable for three times the amount of damages sustained,
as measured by the amount of disgorgement, because of the act or
acts of that person. A person found to be in violation of Section
1883 shall also be liable for the costs of a civil action brought to
recover those damages and attorney fees.
1883.2. (a) Specific or preventive relief may be granted to
enforce a penalty, forfeiture, or penal law in any case of a
violation of Section 1883.
(b) A person who engages, has engaged, or proposes to engage in
any of the conduct set forth in Section 1883, may be enjoined in any
court of competent jurisdiction. The court may make these orders or
judgments, including the appointment of a receiver, as may be
necessary to prevent the use or employment by a person of a practice
or conduct set forth in Section 1883, or as may be necessary to
restore to a person in interest money or property. The court shall
order the disgorgement of the revenue from the use or employment of
any act or practice prohibited by Section 1883, and shall establish
a fluid recovery fund for the return of the funds.
1883.3. Actions for relief pursuant to this chapter shall be
prosecuted exclusively in a court of competent jurisdiction by the
Attorney General, or by a person acting for the interests of itself,
its members, or the general public.
1883.4. Unless otherwise expressly provided, the remedies or
penalties provided by this section are cumulative to each other and
to the remedies or penalties available under all other laws of this
state.