* PRESS RELEASE * PRESS RELEASE * PRESS RELEASE * PRESS RELEASE *
November 10, 2003
MARION COUNTY CIRCUIT COURT
NEW CORPORATE OWNER WOULD ALSO OWE THE REFUNDS
In an order issued November 7, the Marion County Circuit Court ruled that PGE must refund to ratepayers “the full amount of all excessive and unlawful charges collected by the utility for a return on its Trojan investment as previously determined to be improper by both this Court and the Court of Appeals.”
The full order is available via an FTP client or a web browser at ftp://ftp.voters.net/urp/trojan
After going to an FTP site with your web browser, you may have to hit Refresh or Reload to make the list of files appear.
The plaintiffs in the case, led by Utility Reform Project, calculate these refunds at over $300 million. If Enron sells PGE before this refund is paid to customers, the new owner will still owe the refunds to customers.
Judge Paul Lipscomb did not mince words in describing the flawed positions of PGE and the Oregon Public Utility Commission (OPUC). He stated:
In 1978, Oregon voters adopted by a vote of 69 to 21% a ballot measure (Measure 9) to prohibit utilities from charging ratepayers any cost of plants not currently providing utility service to customers. Lloyd Marbet and other activists worked on this measure.In 1992, PGE spent over $5.5 million to defeat a statewide ballot measure to close Trojan in what is still the most expensive statewide ballot measure campaign in Oregon history. Then, within a week, the Trojan plant suffered yet another steam generator tube leak of radioactive water and shut down permanently.We said that the 1978 ballot measure then required that PGE no longer charge ratepayers to earn a profit on Trojan or to get back its investment in Trojan. At that time the investment in Trojan was about $250 million.In 1995, the OPUC allowed PGE to continue to charge ratepayers both for return of the investment over the original expected 35-year life of Trojan and to charge ratepayers to receive a profit on Trojan of over 13% before taxes, for a total of $251 million of Trojan investment and $304 million for profit over the next 17 years (see table below). This is in addition to another $300 million in Trojan decommissioning costs over the next 17 years as well, all of which is being paid by PGE ratepayers.The Utility Reform Project, Lloyd K. Marbet, and CUB appealed this decision to the courts. In June 1998, the Oregon Court of Appeals agreed that allowing the $304 million in profit was a violation of Ballot Measure 9 of 1978. The utilities then substantially increased their contributions to candidates for the Oregon Legislature running in November 1998. As soon as the Legislature convened in January 1999, Enron/PGE had Rep. Jim Hill of Hillsboro introduce a bill to overturn the decision of the Court of Appeals. Jim Hill was quoted in the paper as saying that he was "carrying water for the utilities." After the Legislature passed the bill and Governor Kitzhaber signed it, we waited for the end of the 1999 session and then collected over 60,000 signatures within 90 days to place this bill on the November 2000 ballot as a referendum, Measure 90. We won by over 88% of the vote and received more votes that any side on any Ballot Measure in Oregon history, over 1.2 million.
The Utility Reform Project (URP) immediately filed a complaint at the OPUC challenging this deal as illegal under Ballot Measure 9 of 1978 and the 1998 Court of Appeals opinion.Our expert witness concluded that, for ratepayers, the Settlement was worse than losing the lawsuits that we had been winning. PGE ratepayers have already paid to PGE more than the full investment of Trojan, plus $186 million more, as of October 1, 2001. The Settlement took away all of that money and far more. It took away:
It also imposed upon ratepayers an additional cost of $36.7 million (present value) cost in the form of a "new Regulatory Asset." "Offsetting" this admitted $214 million (present value) cost to ratepayers is a "Customer Credit" of $2.5 million, leaving ratepayers with a net cost of $211.5 million (present value) from the "CUB Stipulation". This is on top of everything ratepayers had already paid. So the CUB Stipulation gave up over $300 million that should have been credited to ratepayers over the next 10 years.PGE and the OPUC staff admitted, under oath, that the Settlement actually increased PGE's rates by $25.7 million as of October 1, 2001, and further increased PGE's rates by $15.7 million per year for the 2 years starting October 1, 2002.The OPUC again approved the PGE-CUB Stipulation deal in April 2002 (OPUC Order No 02-227), and URP again appealed to the courts. Judge Paul Lipscomb of the Marion County Circuit Court on November 7, 2003, issued his decision that OPUC Order 02-227 was unlawful and that ratepayers were entitled to refunds. He stated:
URP believes that the amount of the refund should exceed $300 million. Calculation of that sum is shown on the attached table.