Judge rules against FERC's jurisdiction over dispute over PG & E's power contract

(Reuters) – A San Francisco judge has ruled that the Federal Energy Regulatory Commission has no jurisdiction over litigation involving $ 42 billion worth of contracts. companies in the energy sector.

In a decision on jurisdiction between PG & E and the counterparties to the agreements, Judge Dennis Montali, of the US Bankruptcy Court in San Francisco, said Friday that the interpretation of the law and decree on bankruptcy by the FERC was not allowed and "continues to undermine the function of the bankruptcy court, which is to ensure that the objectives of the law and the policy on bankruptcy are duly served and executed."

Montali ruled that FERC did not have "concurrent jurisdiction" to determine whether Pacific Gas and Electric Company and PG & E Corporation could deny power contracts, and added that they did not have a "competing jurisdiction" to determine whether 39; had no need for FERC approval to refuse their energy purchase contracts.

NextEra Energy Inc., a party to eight power purchase agreements with subsidiaries, argued that the contracts were also subject to the jurisdiction of FERC.

According to NextEra, disputes over agreements fall under the jurisdiction of district courts, as federal non-bankruptcy laws governing interstate commerce must be taken into account.

PG & E, headquartered in San Francisco, filed for Chapter 11 protection against bankruptcy in January against debt estimated at more than $ 30 billion following November's November Fire Camp, the largest fire ever. murderer and most destructive of California in modern times.

PG & E and NextEra did not immediately respond to requests for comment on the decision.