BILL NUMBER: SB 2000 AMENDED
BILL TEXT
AMENDED IN SENATE JUNE 25, 2002
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 conduct , except as specified .
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 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 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: unless the conduct is
covered by rules, tariffs, or an agreement of an electrical
corporation or gas corporation that is authorized under the Public
Utilities Code and has been approved by the Public Utilities
Commission. Conduct to which this section applies, includes, but is
not limited to:
(1) The physical withholding of electricity from 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.
(3) The acquiring, using, or disseminating of electric system
reliability information.
(4) The using or providing of false or misleading information.
(5) The creating, prolonging, or using of shortages or outages.
(6) The refusing of any lawful dispatch order of any transmission
system operator to generate electricity.
(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, 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.
(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.
(10) The misrepresentation of the availability or supply of
electricity or natural gas.
(11) The misrepresentation of the reason or reasons for
electricity generating facility closures, outages, or maintenance.
(12) The selling, distributing, transferring, marketing, or
trading of electricity or natural gas between subsidiaries of the
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 conduct set forth in this
subdivision.
(c) A person shall not knowingly facilitate conduct prohibited by
subdivision (b).
(d) This section does not apply to any company located in
California that is engaged exclusively in the exploration and
production of petroleum and natural gas in California, as defined in
Section 211111 of the North American Industry Classification System.
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.